UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed
by the Registrant ☒
Filed
by a Party other than the Registrant ☐
Check the appropriate box:
|
| ☐ |
Preliminary Proxy Statement |
| ☐ |
Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2)) |
| ☒ |
Definitive Proxy Statement |
| ☐ |
Definitive Additional Materials |
| ☐ |
Soliciting Material under § 240.14a-12 |
| |
|
|
| LOGIQ,
INC. |
| (Name of
Registrant as Specified In Its Charter) |
| |
| N/A |
| (Name of
Person(s) Filing Proxy Statement, if other than the Registrant) |
| |
| Payment of Filing Fee (Check the appropriate
box): |
| |
|
| ☐ |
No fee required. |
| ☐ |
Fee computed
on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. |
| ☒ |
Fee paid previously with preliminary materials. |
| ☐ |
Check box if any part of the fee is offset
as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the
previous filing by registration statement number, or the Form or Schedule and the date of its filing. |
LOGIQ, INC.
85 Broad Street, 16-079
New York, New York 10004
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
To Be Held on October 23, 2023
NOTICE IS HEREBY GIVEN that a
special meeting of the stockholders (the “Meeting”) of Logiq, Inc., a Delaware corporation (the “Company,”
“DLQ Parent” “Logiq” “we” or “us”),
will be held on October 23, 2023, at 11:00 a.m. Eastern Standard Time. We have adopted a completely virtual format for our Meeting to
provide a healthy, consistent, and convenient experience to all stockholders regardless of location. You may attend, vote, and submit
questions during the Meeting via the Internet at www.virtualshareholdermeeting.com/LGIQ2023SM. You may also attend the Meeting by proxy, and
may submit questions ahead of the Meeting through the designated website. For further information about the virtual Meeting, please see
the Questions and Answers about the Meeting beginning on page 2 of the accompanying Proxy Statement. We expect to resume stockholder meetings
in person in the future. The purpose of the Meeting is as follows:
| |
(1) |
To consider and vote upon
a proposal to approve the transactions contemplated under the Merger Agreement dated as of September 9, 2022, as amended (the “Merger
Agreement”), by and among Abri Merger Sub, Inc., a Delaware corporation (“Merger Sub”), and
a wholly owned subsidiary of Abri SPAC I, Inc. (“Abri”), DLQ Parent, and DLQ, Inc., a Nevada corporation
(“DLQ”) a subsidiary of DLQ Parent. Pursuant to the terms of the Merger Agreement, a business combination between
Abri and DLQ will be effected through the merger of Merger Sub with and into DLQ, with DLQ surviving the merger as a wholly owned
subsidiary of Abri (the “Business Combination” or “Merger”), a copy of which
is attached to this proxy statement as Annex A. This Proposal is referred to as the “Business Combination
Proposal” or “Proposal No. 1”; |
| |
|
|
| |
(2) |
To consider and vote upon
a proposal to amend our certificate of incorporation, as amended, to effect, at the discretion of our board of directors, a
reverse stock split of our issued and outstanding shares of common stock, par value $0.0001 per share, such split to combine a number
of outstanding shares of common stock at a ratio of not less than five (5) shares and not more than fifty (50) shares, into one share
of common stock, such ratio to be determined by our board of directors at any time prior to twelve (12) months from the date of stockholder
approval, without further approval or authorization of our stockholders. This Proposal is called the “Reverse Stock Split
Proposal” or “Proposal No. 2”; and |
| |
|
|
| |
(3) |
To consider and vote upon a proposal
to approve the adjournment of the Meeting by the chairman thereof to a later date, if necessary, under certain circumstances, including
for the purpose of soliciting additional proxies in favor of the foregoing Proposals, in the event Logiq does not receive the requisite
stockholder vote to approve the Proposals. This Proposal is called the “Adjournment Proposal” or “Proposal No. 3.” |
The close of business on September
25, 2023 has been fixed as the record date for determining stockholders entitled to notice of, and to vote at, the Meeting or any adjournments
or postponement thereof. For at least ten days prior to the Meeting, a complete list of stockholders entitled to vote at the Meeting will
be open to any stockholder’s examination during ordinary business hours at our principal executive offices located at: 85 Broad
Street, 16-079, New York, New York 10004, (808) 829-1057.
Our Board of Directors has
carefully reviewed and considered the foregoing proposals, and has concluded that each proposal is in the best interests of Logiq and
its stockholders. Therefore, Logiq’s Board of Directors has approved each proposal and recommends that you vote FOR
the Business Combination Proposal, FOR the Reverse Stock Split Proposal and FOR the Adjournment Proposal..
Your vote is important no
matter how large or small your holdings in Logiq may be. If you do not expect to be present at the Meeting virtually, you are urged to
promptly complete, date, sign, and return the proxy card. If you hold your shares beneficially in street name through a nominee, you
should follow the instructions you receive from your nominee to vote these shares. Please review the instructions on each of your voting
options described in the enclosed Proxy Statement you received in the mail. This will not limit your right to virtually attend or vote
at the Meeting. You may revoke your proxy at any time before it has been voted at the Meeting.
The mailing also contains
instructions on how to access the Proxy Statement, which will be available online at www.proxyvote.com on or about October 10, 2023, and
are available on our website at https://www.logiq.com/ir/sec-filings/.
| |
|
By Order
of the Board of Directors |
|
| |
|
|
|
| |
|
/s/Brent Suen |
|
| |
|
Brent Suen |
|
| |
|
President and Executive
Chairman |
|
New York, NY
October 10, 2023
IMPORTANT
YOU ARE CORDIALLY INVITED TO ATTEND THE MEETING
VIRTUALLY. WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE, DATE, SIGN, AND RETURN THE PROXY CARD AS PROMPTLY AS POSSIBLE
IN ORDER TO ENSURE YOUR REPRESENTATION AT THE MEETING. PLEASE REVIEW THE INSTRUCTIONS ON EACH OF YOUR VOTING OPTIONS DESCRIBED IN THE
ENCLOSED PROXY STATEMENT YOU RECEIVED IN THE MAIL. EVEN IF YOU HAVE VOTED BY PROXY, YOU MAY STILL VOTE VIRTUALLY IF YOU ATTEND THE MEETING.
PLEASE NOTE, HOWEVER, THAT IF YOUR SHARES ARE HELD OF RECORD BY A BROKER, BANK, OR OTHER NOMINEE AND YOU WISH TO VOTE AT THE MEETING,
YOU MUST OBTAIN A PROXY CARD ISSUED IN YOUR NAME FROM THAT INTERMEDIARY. A MAJORITY OF THE ISSUED AND OUTSTANDING SHARES OF COMMON STOCK
OF THE COMPANY AS OF THE RECORD DATE MUST BE REPRESENTED AT THE MEETING, EITHER VIRTUALLY OR BY PROXY, TO CONSTITUTE A QUORUM.
LOGIQ, INC.
85 Broad Street, 16-079
New York, New York 10004
(808) 829-1057
PROXY STATEMENT
FOR
SPECIAL MEETING OF STOCKHOLDERS
To Be Held on October 23, 2023 at 11:00 a.m. Eastern
Standard Time
GENERAL INFORMATION
This proxy statement (the “Proxy
Statement”) is furnished in connection with the solicitation of proxies by the Board of Directors (the “Board”)
of Logiq, Inc., a Delaware corporation (the “Company,” “DLQ Parent” “Logiq,”
“we” or “us”), for use at the special meeting of stockholders (the “Meeting”)
of the Company, to be held on October 23, 2023, at 11:00 a.m. Eastern Standard Time. We have adopted a completely virtual format for
our Meeting to provide a healthy, consistent, and convenient experience to all stockholders regardless of location. You may attend, vote,
and submit questions during the Meeting via the Internet at www.virtualshareholdermeeting.com/LGIQ2023SM.
You may also attend the Meeting by proxy, and may submit questions ahead of the Meeting through the designated website. For further information
about the virtual Meeting, please see the Questions and Answers about the Meeting beginning on page 3 of this Proxy Statement. We expect
to resume stockholder meetings in person in the future. This Proxy Statement and the enclosed proxy card will be made available to our
stockholders on or about October 10, 2023.
Abri SPAC 1, Inc. is a Delaware
blank check company (“Abri”) established for the purpose of entering into a merger, share exchange, asset acquisition,
stock purchase, recapitalization, reorganization or other similar business transaction with one or more businesses or entities, which
they refer to as a “target business.” Holders of Logiq Common Stock will be asked to approve the Merger Agreement, dated
as of September 9, 2022, as amended (the “Merger Agreement”), by and among Abri Merger Sub, Inc., a Delaware
corporation and a wholly owned subsidiary of Abri (“Merger Sub”), DLQ Parent, and DLQ, Inc., a Nevada corporation
(“DLQ”) and subsidiary of DLQ Parent. Abri’s
Units, Common Stock and Warrants are currently listed on the Nasdaq Stock Market, under the symbols “ASPAU,” “ASPA,”
and “ASPAW,” respectively. The Units, Common Stock and Warrants commenced trading on the Nasdaq Stock Market separately on
September 3, 2021.
Upon the closing of the transactions
contemplated in the Merger Agreement, Merger Sub will merge with and into DLQ (the “Business Combination” or
“Merger”) with DLQ surviving the Merger as a wholly owned subsidiary of Abri (the “Surviving Corporation”). In
addition, in connection with the consummation of the Merger, Abri will be renamed “Collective Audience, Inc.” The Merger
requires approval by the stockholders of Abri, DLQ and DLQ Parent.
The transactions contemplated
under the Merger Agreement relating to the Merger are referred to in this proxy statement as the “Business Combination” and
the combined company after the Business Combination is referred to in this proxy statement as the “Combined Company.”
Abri has filed a listing application
with Nasdaq to list the Combined Company’s shares of Common Stock and Warrants on Nasdaq Global Market under the symbol “CAUD”
and “CAUDW”. Although we believe that the Combined Company will meet the initial listing requirements for the Nasdaq Global
Market, and such listing is a condition to consummating the Business Combination, we cannot assure you that the shares of Common Stock
and Warrants will be approved for listing on Nasdaq Global Market, in which case we would not be able to consummate the Business Combination.
Please see Risk Factors on page 50.
Pursuant to the Merger Agreement,
the following actions will be taken, and the following consideration will be paid, in connection with the Business Combination:
Treatment of DLQ Securities
Cancellation of Securities
Each share of DLQ Common Stock
(defined below), if any, that is owned by Abri, Merger Sub, DLQ, or any other affiliate of Abri (as treasury stock or otherwise) immediately
prior to the effective time of the Merger (the “Effective Time”), will automatically be cancelled and retired without any
conversion or consideration.
| · | “DLQ
Common Stock” means at the Effective Time, each issued and outstanding share of
DLQ’s common stock, par value $0.0001 per share (other than any such shares of DLQ
common stock cancelled as described above) which will be converted into the right to receive
a number of shares of Abri Common Stock equal to the Conversion Ratio. |
| · | “Conversion
Ratio” means the quotient obtained by dividing (a) the Per Share Merger Consideration
by (b) $10.00. |
| · | “Per
Share Merger Consideration” means an amount equal to $114,000,000, divided by the
number of Fully Diluted Company Shares. |
| · | “Fully
Diluted Company Shares” means the sum, without duplication, of (a) all shares of
DLQ Common Stock that are issued and outstanding immediately prior to the Effective Time
plus (b) all shares of DLQ Common Stock issuable upon conversion, exercise or exchange of
any other in-the-money securities of DLQ convertible into or exchangeable or exercisable
for shares of DLQ Common Stock; |
| · | “Merger
Consideration Shares” means an aggregate number of shares of Abri Common Stock
equal to the product of (i) the Conversion Ratio, multiplied by (ii) Fully-Diluted Company
Shares. |
| · | “Dividend
Shares” means the number of Merger Consideration Shares that will be issued as a dividend to the DLQ Parent Stockholders concurrent
with Closing (the “Distribution”), on a pro rata basis in an amount equal to approximately thirty three percent
(33%) of the aggregate Merger Consideration Shares (the “Dividend Shares”) pursuant to the record date set
specifically for the Distribution. The remaining Merger Consideration Shares held by DLQ Parent will be subject to a lock-up in accordance
with the terms and conditions more fully set forth in the Lock-Up Agreement, as described herein |
Abri filed a proxy statement
and prospectus on Form S-4 on November 11, 2022, and as amended on February
8, 2023, May 11, 2023, June 2, 2023, July 25, 2023, August 14, 2023, September 5, 2023, September 15, 2023, September 22, 2023 and September
27, 2023 that covers the registration of the aggregate 11,400,000 shares of Abri Common Stock to be issued as Merger Consideration
Shares to DLQ Parent, including the Dividend Shares.
Merger Sub Securities
Each share of common stock,
par value $0.0001 per share, of Merger Sub issued and outstanding immediately prior to the Effective Time will be converted into and
become one newly issued share of common stock of the Surviving Corporation.
It
is anticipated that, upon consummation of the Business Combination, after giving effect to the Merger Consideration including the Earnout
Consideration, as described herein, the exercise of outstanding Public Warrants and Private Warrants, and assuming (i) no additional
redemption of shares by the public stockholders (ii) interim redemption of 341,074 shares
by the public stockholders, and (iii) maximum redemption of shares by the public stockholders, the existing public Abri stockholders
will own approximately 3.0%, 1.5% and 0%, respectively, of the issued Combined Company’s shares of Common Stock, the Sponsor and
its affiliates will own 7.6%, 7.7% and 7.8%, respectively of the issued Combined Company’s shares of Common Stock, the Representative
(as defined below) will own 0.1%, 0.1% and 0.1%, respectively of the
issued Combined Company’s shares of Common Stock, and DLQ Parent will own 26.4%, 26.8% and 27.2%, respectively, of the issued Combined
Company’s shares of Common Stock, DLQ Parent Stockholders will own 12.5%, 12.6% and 12.8%, respectively,
of the issued Combined Company’s shares of Common Stock, and DLQ Management will own 8.5%, 8.8% and 9.0%, respectively,
of the issued Combined Company’s shares of Common Stock after the issuance of the Management Earnout Shares.
If the actual facts are different
from these assumptions (which they are likely to be), the percentage ownership and its relative value retained by the DLQ Parent Stockholders
will be different. See “Unaudited Pro Forma Condensed Combined Financial Information.”
Immediately
upon consummation of the Business Combination, the Combined Company will be controlled by DLQ Parent, which will own 58.6%
of the Combined Company, without taking into account the redemption of any additional shares of Common Stock by the public stockholders
or the issuance of any Earnout Shares, which include up to 1,000,000 Earnout Shares to be distributed to the Sponsor and up to 2,000,000
Earnout Shares to be distributed to DLQ Management, if certain milestones are achieved after the Business Combination. Therefore, the
Combined Company will be deemed a “controlled company” within the meaning of Nasdaq corporate governance listing standards
and as a result, the Combined Company will qualify for, and if the Combined Company so elects, may rely on exemptions from certain Nasdaq
corporate governance listing standards. For more information, see “Directors and Executive Officers of the Combined Company
After the Business Combination — Controlled Company Exemption.”
At a special meeting of Abri’s
stockholders held on December 9, 2022 (the “Extension Meeting”), Abri’s stockholders approved (i) a proposal
to amend Abri’s amended and restated certificate of incorporation, and (ii) a proposal to amend the Management Trust Agreement
with the Transfer Agent, to extend the date by which Abri has to consummate a business combination from February 12, 2023 until August
12, 2023, on an as needed, month-to-month basis. On February 6, 2023, March 10, 2023, April 11, 2023, May 11, 2023 and June 9, 2023 and
July 10, 2023 Abri deposited $87,500 into the Trust Account for each one-month extension (or a total of $525,000), to extend the time
to complete a business combination to August 12, 2023.
At a special meeting of Abri’s
stockholders held on August 7, 2023 (the “Second Extension Meeting”), Abri’s stockholders approved the
proposal to amend Abri’s Charter: (a) giving Abri the right to extend the date by which it has to complete a business combination
to February 12, 2024 without making any further deposits into the Trust Account, and (b) to change the Charter by removing the requirement
to have net tangible assets of at least $5,000,001 upon consummation of a Business Combination.
In connection with the Second
Extension Meeting, 570,224 shares were tendered for redemption. As a result, approximately $6.05 million (approximately $10.62 per share),
after deducting allowable taxes, will be removed from Abri’s trust account to pay such holders. Following redemptions, Abri has
682,148 public shares of common stock outstanding.
As of September 25, 2023, there
was approximately $7,285,885 in Abri’s trust account. On September 25, 2023, the record date for the Meeting, the last sale price
of Abri’s shares of Common Stock was $10.95.
Only stockholders of record at
the close of business on September 25, 2023 (the “Record Date”), are entitled to notice of, and to vote at,
the Meeting. At the close of business on the Record Date, 105,284,314 shares of Logiq’s common stock, par value $0.001 per share
(“Common Stock”), were issued and outstanding. At the close of business on the Record Date, outstanding shares
of Logiq’s Common Stock were held by approximately 602 stockholders of record. Shares cannot be voted at the Meeting unless the
holder thereof is present or represented by proxy. The presence, virtually or by proxy, of the holders of a majority of the issued and
outstanding shares of Common Stock of Logiq as of the Record Date will constitute a quorum for the transaction of business at the Meeting
and any adjournment or postponement thereof.
Our Board has selected Brent
Suen to serve as the holder of proxies for the Meeting. The shares of Common Stock represented by each executed and returned proxy will
be voted by Mr. Suen in accordance with the directions indicated on the proxy. If you sign your proxy card without giving specific instructions,
Mr. Suen will vote your shares “FOR” each of the Proposals. The proxy also confers discretionary authority to vote the shares
authorized to be voted thereby on any matter that may be properly presented for action at the Meeting; we currently know of no other
business to be presented.
Any proxy given may be revoked
by the person giving it at any time before it is voted at the Meeting. If you have not voted through your broker, there are three ways
for you to revoke your proxy and change your vote. First, you may send a written notice to the Company’s Secretary stating that
you would like to revoke your proxy. Second, you may complete and submit a new proxy card, but it must bear a later date than your original
proxy card. Third, you may vote virtually at the Meeting. However, your attendance at the Meeting will not, by itself, revoke your proxy.
If you have instructed a broker to vote your shares, you must follow the directions you receive from your broker to change your vote.
Your last submitted proxy will be the proxy that is counted. Please note that dissenters’ rights are not available with respect
to any of the proposals to be voted on at the Meeting.
We will provide copies of
this Proxy Statement and accompanying materials to brokerage firms, fiduciaries, and custodians for forwarding to beneficial owners and
will reimburse these persons for their costs of forwarding these materials. Our directors, officers, and employees may solicit proxies
by telephone, facsimile, or personal solicitation. We will not pay additional compensation for any of these services.
If you would like to request
documents, please do so no later than October 16, 2023, to receive them before the Meeting. Please be sure to include your complete name and
address in your request. Please see “Where You Can Find Additional Information” to find out where you can find more
information about Abri, Logiq and DLQ.
TABLE OF CONTENTS
ADDITIONAL INFORMATION
This document constitutes
a notice of meeting and a proxy statement under Section 14(a) of the Securities Exchange Act of 1934, as amended
(the “Exchange Act”), with respect to the Special Meeting, at which Logiq stockholders will be asked to consider and
vote upon a proposal to approve the Business Combination by the approval and adoption of the Merger Agreement, and the Reverse Stock
Split, among other matters.
You should rely only on the
information contained or incorporated by reference into this proxy statement. No one has been authorized to provide you with information
that is different from that contained in, or incorporated by reference into, this proxy statement. This proxy statement is dated as of
the date set forth on the cover hereof. You should not assume that the information contained in this proxy statement is accurate as of
any date other than that date. You should not assume that the information incorporated by reference into this proxy statement is accurate
as of any date other than the date of such incorporated document. Neither the mailing of this proxy statement to Logiq stockholders nor
the issuance of Abri Common Stock in connection with the Business Combination will create any implication to the contrary.
Information contained in this
proxy statement regarding Abri has been provided by Abri and information contained in this proxy statement regarding Logiq or DLQ has
been provided by Logiq.
This proxy statement does
not constitute an offer to sell or a solicitation of an offer to buy any securities, or the solicitation of a proxy, in any jurisdiction
to or from any person to whom it is unlawful to make any such offer or solicitation in such jurisdiction.
Each of Abri and Logiq files
reports, proxy statements/prospectuses and other information with the SEC as required by the Exchange Act. You can read Abri’s
and Logiq’s SEC filings, including this proxy statement, over the Internet at the SEC’s website at http://www.sec.gov.
If you would like additional
copies of this proxy statement or if you have questions about the Business Combination or the proposals to be presented at the Special
Meeting, you should contact us by telephone or in writing:
LOGIQ, INC.
85 Broad Street, 16-079
New York, New York 10004
Attention: Chief Executive Officer
Tel: (808) 829-1057
MARKET AND INDUSTRY DATA
Certain information contained
in this proxy statement relates to or is based on studies, publications, surveys and other data obtained from third-party sources
and Abri’s and DLQ’s own internal estimates and research. While we believe these third-party sources to be reliable
as of the date of this proxy statement, we have not independently verified the market and industry data contained in this proxy statement
or the underlying assumptions relied on therein. Finally, while we believe our own internal research is reliable, such research has not
been verified by any independent source.
TRADEMARKS
This document contains references
to trademarks, trade names and service marks belonging to other entities. Solely for convenience, trademarks, trade names and service
marks referred to in this proxy statement may appear without the ® or TM symbols, but such
references are not intended to indicate, in any way, that the applicable licensor will not assert, to the fullest extent under applicable
law, its rights to these trademarks and trade names. We do not intend our use or display of other companies’ trade names, trademarks
or service marks to imply a relationship with, or endorsement or sponsorship of us by, any other companies.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This proxy statement and the
documents incorporated by reference herein contain certain forward-looking statements, within the meaning of “safe harbor”
provisions of the Private Securities Litigation Reform Act of 1995, as amended (“PSLRA”). Investors should
note that on April 8, 2021, the staff of the SEC issued a public statement entitled “SPACs, IPOs and Liability Risk under the Securities
Laws,” in which the SEC staff indicated that there is uncertainty as to the availability of the safe harbor under the PSLRA in
connection with a merger with a special purpose acquisition company. Shareholders should also note that on March 30, 2022, the SEC announced
the proposal of new rules and amendments concerning special purpose acquisition companies (“SPACs”) that, if
adopted, would, among other things, prohibit SPACs from taking advantage of the liability safe harbor in the Private Securities Litigation
Reform Act of 1995 regarding forward-looking statements in SEC filings and with respect to business combination transactions.
Forward-looking statements can
be identified by words such as “target,” “believe,” “expect,” “will,” “shall,”
“may,” “anticipate,” “estimate,” “would,” “positioned,” “future,”
“forecast,” “intend,” “plan,” “project” and other similar expressions that predict or
indicate future events or trends or that are not statements of historical matters. Examples of forward-looking statements include, among
others, statements made in this proxy statement regarding the proposed transactions contemplated by the Merger Agreement, including the
benefits of the Merger, integration plans, expected synergies and revenue opportunities, anticipated future financial and operating performance
and results, including estimates for growth, achievement of the Earnout Consideration, other performance metrics, projections of market
opportunity, expected management and governance of the Combined Company and expected timing of the Merger. Forward-looking statements
are neither historical facts nor assurances of future performance. Instead, these statements are based on various assumptions, whether
or not identified in this proxy statement and on the current expectations of the Company’s, Abri’s and DLQ’s respective
management and are not predictions of actual performance. These forward-looking statements are provided for illustrative purposes only
and are not intended to serve, and must not be relied on by any investor, as a guarantee, an assurance, a prediction or a definitive statement
of fact or probability. Actual events and circumstances are difficult or impossible to predict and will differ from assumptions. Many
actual events and circumstances are beyond the control of the Company, Abri and/or DLQ. Some important factors that could cause actual
results to differ materially from those in any forward-looking statements could include changes in domestic and foreign business, market,
financial, political and legal conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties,
risks and changes in circumstances that are difficult to predict and many of which are outside of the Company’s, Abri’s and
DLQ’s control. Actual results and outcomes may differ materially from those indicated in the forward-looking statements. Therefore,
investors and securityholders of DLQ should not rely on any of these forward-looking statements.
Important factors that could
cause actual results and outcomes to differ materially from those indicated in the forward-looking statements include, among others,
the following: (1) the occurrence of any event, change or other circumstances that could give rise to an amendment or termination of
the Merger Agreement and the proposed transaction contemplated thereby; (2) the inability to complete the transactions contemplated by
the Merger Agreement due to the failure to obtain approval of the stockholders of Abri, DLQ Parent or DLQ or other conditions to closing
in the Merger Agreement; (3) the inability to project with any certainty the amount of cash proceeds remaining in the Trust Account at
Closing; (4) the uncertainty relative to the cash made available to DLQ at Closing should any material redemption requests be made by
the Abri stockholders (since the sources of cash projected assume that no redemptions will be requested by Abri stockholders); (5) the
inability of the Combined Company to obtain or maintain the listing of its securities on Nasdaq following the Merger; (6) the amount
of costs related to the Merger; (7) the outcome of any legal proceedings that may be instituted against the parties to the Merger Agreement
following the announcement of the proposed Merger; (8) changes in applicable laws or regulations; (9) the ability of DLQ to meet its
post-Closing financial and strategic goals due to competition, among other things; (10) the ability of the Combined Company to grow and
manage growth profitability and retain its key employees; (11) the possibility that the Combined Company may be adversely affected by
other economic, business and/or competitive factors; (12) risks relating to the successful retention of DLQ’s customers; (13) the
potential impact that the COVID-19 pandemic may have on DLQ’s customers, suppliers, vendors, regulatory agencies, employees and
the global economy as a whole; (14) the expected duration over which DLQ’s balances will fund its operations; and (15) other risks
and uncertainties described herein, as well as those risks and uncertainties indicated in Abri’s final prospectus filed with the
SEC on August 11, 2021 in connection with Abri’s initial public offering, particularly those under the “Risk Factors”
sections therein, and in Abri’s other filings with the SEC. Logiq cautions that the foregoing list of factors is not exclusive.
If any of these risks materialize or Abri’s, DLQ Parent’s or DLQ’s assumptions prove incorrect, actual results could
differ materially from the results implied by these forward-looking statements. There may be additional risks that neither Abri, DLQ
Parent, nor DLQ presently know, or that Abri, DLQ Parent and DLQ currently believe are immaterial that could also cause actual results
to differ from those contained in the forward-looking statements. In addition, forward-looking statements reflect Abri, DLQ Parent and
DLQ’s current expectations, plans and forecasts of future events and views as of the date hereof. Nothing in this proxy statement
and the attachments hereto should be regarded as a representation by any person that the forward-looking statements set forth herein
will be achieved or that any of the contemplated results of such forward-looking statements will be achieved. Investors and securityholders
of Logiq should not place undue reliance on forward-looking statements in this proxy statement and the attachments hereto, which speak
only as of the date they are made and are qualified in their entirety by reference to the cautionary statements herein and the risk factors
of Abri and DL. The Company, Abri and DLQ anticipate that subsequent events and developments will cause their assessments to change.
All subsequent written and
oral forward-looking statements concerning the Business Combination or other matters addressed in this proxy statement and attributable
to Abri, DLQ Parent, DLQ or any person acting on their behalf are expressly qualified in their entirety by the cautionary statements
contained or referred to in this proxy statement. Except to the extent required by applicable law or regulation, the Company, Abri and
DLQ undertake no obligation to update these forward-looking statements to reflect events or circumstances after the date of this proxy
statement or to reflect the occurrence of unanticipated events. Accordingly, undue reliance should not be placed upon the forward-looking
statements.
QUESTIONS AND ANSWERS REGARDING THIS SOLICITATION
AND VOTING AT THE MEETING
The following are answers
to some questions that you, as a stockholder of Logiq, may have regarding the Proposals being considered at the Meeting. We urge you
to read carefully the remainder of this proxy statement because the information in this section does not provide all the information
that might be important to you with respect to the Proposals and the other matters being considered at the Meeting. Additional important
information is also contained in the annexes to and the documents incorporated by reference into this proxy statement. The “Company,”
“DLQ Parent” “Logiq,” “we” or “us” as used herein all refer to Logiq, Inc.
In this Proxy Statement, unless the context otherwise requires:
| ● | “Abri Warrants” or “Warrants” refers
to the redeemable warrants that entitle the holder of each whole warrant to purchase one share of Common Stock at a price of $11.50 per
share, consisting of the Public Warrants and the Private Warrants. |
| ● | “Amended Charter” means the Second Amended and Restated
Certificate of Incorporation of Abri. |
| ● | “Ancillary Agreements” means the agreements contemplated
by the Merger Agreement. |
| ● | “ASC” means the Accounting Standards Codification. |
| ● | “Board” means the board of directors of Logiq. |
| ● | “Business Combination” or “Merger” means
the merger contemplated by the Merger Agreement. |
| ● | “Certificate of Incorporation” or “Current
Charter” means Abri’s current Amended and Restated Certificate of Incorporation. |
| ● | “Closing” means the consummation of the Business
Combination. |
| ● | “Closing Date” means date of the consummation of
the Business Combination. |
| ● | “Code” means the Internal Revenue Code of 1986, as
amended. |
| ● | “Combined Company” means Abri after the Business
Combination, renamed “Collective Audience, Inc.” |
| ● | “Common Stock” means the shares of common stock,
par value $0.0001 per share, of Abri prior to the Closing, and the Common Stock of the Combined Company following the Closing. |
| ● | “Continental” means Continental Stock Transfer &
Trust Company, Abri’s transfer agent. |
| ● | “DLQ” means DLQ, Inc., a Nevada corporation and subsidiary
of DLQ Parent. |
| ● | “DLQ Investment” means the private placement in DLQ
consummated on September 5, 2023. |
| ● | “DLQ Investors” means investors in the DLQ Investment. |
| ● | “DLQ Management” means Brent Suen, the chief executive
officer of DLQ, Chris Andrews as Chief Operating Officer of the combined company and Robb Billy as Chief Financial officer of the combined
company. |
| ● | “DLQ Parent” means Logiq, Inc., a Delaware corporation
and parent company of DLQ. |
| ● | “DLQ Parent Stockholders means the approximate 602 holders of record
of DLQ Parent common stock as of September 25, 2023 |
| ● | “Earnout Consideration” or “Earnout Shares”
means both the Management Earnout Shares and the Sponsor Earnout Shares. |
| ● | “Exchange Act” means the Securities Exchange Act of 1934,
as amended. |
| ● | “Extension
Meeting” means a special meeting of Abri’s stockholders held on December 9, 2022 whereby Abri’s stockholders
approved (i) a proposal to amend Abri’s amended and restated certificate of incorporation, and (ii) a proposal to amend the Management
Trust Agreement between Abri and Continental Stock &Transfer Company, or the “Transfer Agent”, to extend the date by
which Abri has to consummate a business combination from February 12, 2022 until August 12, 2023, on an as needed, month-to-month basis,
by depositing an additional $87,500 into the Trust Account for each such one-month extension |
| ● | “Fully Diluted Company Shares” means the sum, without
duplication, of (a) all shares of DLQ Common Stock that are issued and outstanding immediately prior to the Effective Time plus
(b) all shares of DLQ Common Stock issuable upon conversion, exercise or exchange of any other in-the-money securities of the DLQ
convertible into or exchangeable or exercisable for shares of DLQ Common Stock. |
| ● | “founder shares” means the 1,433,480 outstanding
shares of Abri Common Stock held by the Sponsor, sold for an aggregate purchase price of $25,000 on April 12, 2021. |
| ● | “GAAP” means accounting principles generally accepted
in the United States of America. |
| ● | “HSR Act” means Hart-Scott-Rodino Antitrust Improvements
Act of 1976, as amended. |
| ● | “Initial Stockholders” means the Sponsor and other
initial holders of Common Stock of Abri and Private Units, excluding the holders of the Representative Shares. |
| ● | “IPO” refers to the initial public offering of 5,000,000 Units of
Abri consummated on August 12, 2021. |
| ● | “IRS” means the United States Internal Revenue
Service. |
| ● | “Management Earnout Shares” means the shares of Abri
Common Stock issued to certain management of DLQ pursuant to the Management Earnout Agreement. |
| |
● |
“Meeting” means the special meeting of the stockholders of Logiq, which will be held virtually on October 23, 2023 11:00am., Eastern time, on October 23, 2023. |
| ● | “Merger Agreement” means that certain Merger Agreement,
dated as of September 9, 2022, by and among Abri, Merger Sub, DLQ, and DLQ Parent, as amended. |
| ● | “Merger Sub” means Abri Merger Sub, Inc., a Delaware
corporation and wholly-owned subsidiary of Abri. |
| ● | “Per Share Merger Consideration” means an amount
equal to $114,000,000, divided by the number of Fully Diluted Company Shares of DLQ. |
| ● | “Private Placement” means the private placement entered
into by Abri and the Sponsor, which was consummated simultaneously with the IPO. |
| ● | “public stockholders” means holders of shares of
Abri Common Stock excluding founder shares. |
| ● | “Private Units” means the 294,598 Units issued
to the Sponsor pursuant to the Private Placement. |
| ● | “Private Warrants” means the 294,598 Abri Warrants
included as components of the Private Units that entitle the holder of each whole warrant to purchase one share of Common Stock
at a price of $11.50 per share in a private placement. |
| ● | “Public Warrants” means the Warrants included in
the Units that entitle the holder of each whole warrant to purchase one share of Common Stock at a price of $11.50 per share. |
| ● | “Representative” or “Chardan Capital Markets”
means Chardan Capital Markets, the representative of the underwriters in the Abri IPO. |
| ● | “SEC” means the U.S. Securities and Exchange
Commission. |
| ● | “Second Extension Meeting” means a special meeting
of Abri’s stockholders held on August 7, 2023 whereby Abri’s stockholders approved the proposal to amend Abri’s
Charter: (a) giving Abri the right to extend the date by which it has to complete a business combination to February 12, 2024 without
making any further deposits into the Trust Account, and (b) to change the Charter by removing the requirement to have net tangible assets
of at least $5,000,001 upon consummation of a Business Combination. We refer to Abri’s amendments to the certificate of incorporation
and to the Trust Agreement collectively as the “August Amendments.” |
| ● | “Securities Act” means the Securities Act of 1933,
as amended. |
| ● | “Sponsor” means Abri Ventures I, LLC, a Delaware
limited liability company. |
| ● | “Sponsor Earnout Shares” means the shares of Abri
Common Stock issuable to the Sponsor pursuant to the Sponsor Earnout Agreement. |
| ● | “Surviving Corporation” means the corporation surviving
the Merger as a wholly owned subsidiary of Abri. |
| ● | “Trust Account” means Abri’s trust account
maintained by Continental. |
| ● | “Unit Purchase Option” means the option granted to
Chardan Capital Markets to purchase up to 344,035 Units in addition to those sold in the IPO and the Private Placement. |
| ● | “Units” means the units of Abri issued in the IPO,
each consisting of one share of Common Stock and one Warrant. |
Q. What
is the purpose of this document?
A. Abri,
Merger Sub, DLQ Parent and DLQ have agreed to the Business Combination under the terms of the Merger Agreement and amendments thereto,
which are attached to this proxy statement as Annex A, and is incorporated into this proxy statement by reference. Abri has
filed a registration statement on Form S-4 on November 11, 2022, and as amended on February 8, 2023, May 11, 2023, June 2, 2023, July
25, 2023, August 14, 2023, September 5, 2023, September 15, 2023, September 22, 2023 and September 27, 2023, registering the aggregate
11,400,000 Abri common shares to be issued to DLQ Parent in connection with the Merger Agreement, including the 3,762,000 Dividend Shares
to be distributed to the DLQ Parent’s stockholders as of a record date set concurrent with Closing which represents 33% of the
Merger Consideration Shares, 1,600,000 to be distributed to the DLQ Investors, which represents 14% of the Merger Consideration Shares,
and the remaining 53% will be distributed to DLQ Parent, all or some of which may be distributed to DLQ Management. In addition, DLQ
Management are eligible to receive up to 2,000,000 Management Earnout Shares. The Board is soliciting your proxy to vote for the Business
Combination and other Proposals at the Meeting because you owned DLQ Parent Common Stock at the close of business the Record Date for
the Meeting, and are therefore entitled to vote at the Meeting. This proxy statement summarizes the information that you need to know
in order to cast your vote.
Q. When is the Meeting?
A. On October 23, 2023, at 11:00
a.m. Eastern Standard Time.
Q. Where will the Meeting be held?
A. Logiq has adopted a completely
virtual format for the Meeting to provide a healthy, consistent, and convenient experience to all stockholders regardless of location.
You may attend, vote, and submit questions during the Meeting via the Internet at www.virtualshareholdermeeting.com/LGIQ2023SM.
Q. Why am I receiving these Proxy Materials?
A. As permitted by rules
adopted by the Securities and Exchange Commission (the “SEC”), we are making this Proxy Statement
available to our stockholders electronically via the Internet. This Proxy Statement which contains instructions on how to access
this Proxy Statement and vote via the Internet, by phone, or by mail is first being mailed to all stockholders of record entitled to
vote at the Meeting on or about October 10, 2023. We sent you this Proxy Statement because the Board is soliciting your proxy to
vote at the Meeting. You are invited to virtually attend the Special Meeting to vote on the proposals described in this Proxy
Statement. However, you do not need to attend the Meeting to vote your shares. Instead, you may follow the instructions in the Proxy
Statement to vote by Internet, by phone or by mail.
Q. Who is entitled to vote
at the Meeting?
A. Only stockholders who owned
shares of Logiq Common Stock at the close of business on the Record Date are entitled to notice of the Meeting and to vote at the Meeting,
and at any postponements or adjournments thereof. At the close of business on the Record Date, 105,284,314 shares of Logiq’s Common
Stock were issued and outstanding. At the close of business on the Record Date, outstanding shares of Logiq Common Stock were held by
more than 602 stockholders of record.
For each share of Common Stock
held as of the Record Date, the holder is entitled to one vote on each proposal to be voted on. As such, holders of Common Stock are entitled
to a total of 105,284,314 votes.
Q. How many shares must
be present to conduct business?
A. The presence at the Meeting,
virtually or by proxy, of the holders of a majority of the shares of Common Stock issued and outstanding as of the close of business
on the Record Date will constitute a quorum. A quorum is required to conduct business at the Meeting and any adjournment or postponement
thereof, in accordance with the Bylaws.
Q. What will be voted
on at the Meeting?
A. The following chart sets
forth the proposals scheduled for a vote at the Meeting and the vote required for such proposals to be approved:
| Proposal |
|
Votes
Required |
Voting
Options |
Board
Recommendation |
| |
|
|
|
|
Proposal 1: To approve the Business
Combination Proposal to approve the Merger Agreement and the Business Combination
|
|
The Business Combination Proposal requires
the affirmative vote of the majority of the issued and outstanding shares of Common Stock as of close of business on the Record Date.
An abstention will have the effect of a vote
“AGAINST” Proposal No. 1. Broker non-votes will have no effect on the vote for Proposal No. 1. |
“FOR”; or
“AGAINST” |
“FOR” |
| |
|
|
|
|
Proposal 2: To approve the Reverse
Stock Split Proposal.
|
|
The affirmative (“FOR”) vote
of at least a majority in voting power of the shares of our capital stock issued and outstanding as of close of business on the Record
Date.
Abstentions will be counted toward the
tabulation of votes cast on this proposal and will have the same effect as “AGAINST” votes. Broker non-votes, if
any, will have the same effect as “AGAINST” votes. However, because we believe that this proposal will be treated as a routine
matter, we do not expect to receive any broker non-votes on this proposal. |
“FOR” or “AGAINST”
or “ABSTAIN” |
“FOR” |
| Proposal
3: To approve the Adjournment Proposal to approve the adjournment of the Meeting. |
|
The Adjournment Proposal requires the affirmative
vote of the majority of the issued and outstanding shares of Common Stock present in person by virtual attendance or represented
by proxy and entitled to vote at the Meeting.
Abstentions will have the effect of a vote
“AGAINST” Proposal No. 3. Broker-non votes have no effect on the vote for Proposal No. 3. The Adjournment Proposal,
if adopted, will approve the chairman’s adjournment of the Meeting to a later date to permit further solicitation of proxies.
The Adjournment Proposal will only be presented to our stockholders in the event, based on the tabulated votes, there are not sufficient
votes received at the time of the Meeting to approve the other Proposals. |
“FOR”; or
“AGAINST”
|
“FOR” |
| Q. | What will happen in the Business Combination? |
| A: | At Closing, Merger Sub will merge with and into DLQ, with DLQ
surviving the Merger as the surviving entity. Upon consummation of the Business Combination, DLQ will become a wholly-owned subsidiary
of Abri. In connection with the Business Combination, the cash held in the Trust Account after giving effect to any redemption of
shares by public stockholders will be used to pay certain fees and expenses in connection with the Business Combination, and for working
capital and general corporate purposes. A copy of the Merger Agreement is attached to this proxy statement as Annex A. |
| Q. | What is the consideration being paid to DLQ Parent securityholders? |
| A. | DLQ Parent will receive 11,400,000 shares of Common Stock, of which 3,762,000
(or 33%) will be distributed to DLQ Parent’s securityholders (as of record date set at that time) as the Dividend Shares on a pro
rata basis, 1,600,000 (or 14%) will be distributed to DLQ Investors, and the remaining 6,038,000 shares (or 53%) will be distributed to
DLQ Parent, all or some of which may be distributed to DLQ Management. The Distribution of the Dividend Shares will occur on the Distribution
Date concurrent with closing to Logiq stockholders of record on the record date set by Logiq as the date for determination of Logiq stockholders
entitled to participate in the Distribution, which is expected to be set shortly after the Meeting. The exact number of shares of Abri
Common Stock being distributed to each such Logiq stockholder will not be determined until the above record date is set. Additionally,
certain members of DLQ’s management have the contingent right to receive up to 2,000,000 of the Management Earnout Shares. |
| Q. | What equity stake will current stockholders of Abri, DLQ and
DLQ Parent Stockholders hold in the Combined Company after the Closing? |
| A: | In connection with the Extension Meeting held on December 9, 2022 to extend
the time Abri has to consummate a Business Combination, public stockholders of Abri Common Stock requested redemption of 4,481,548 shares
or 78% of the public shares of Common Stock. In connection with the Second Extension Meeting held on August 7, 2023, public stockholders
of Abri Common Stock requested redemption of 570,224 shares or 45% of the public shares of Common Stock. It is anticipated that upon Closing,
public stockholders will retain an ownership interest of approximately 4.9% in the Combined Company. The Sponsor, officers, directors
and other holders of founder shares will retain an ownership interest of approximately 12.5% of the Combined Company. The Representative
will retain an ownership interest of approximately 0.2% of the Combined Company. DLQ Parent will own approximately 43.6% of the Combined
Company, and the DLQ Parent Stockholders will own approximately 11.6% of the Combined Company upon the distribution of the Dividend Shares.
DLQ Management currently own approximately 1.01 million shares or 1.8% of DLQ Parent. There are no stockholders of DLQ Parent that hold
more than 10% of its common stock. Please also review “Ownership of the Combined Company After the Closing” and “Potential
Impact of Additional Dilution” Beginning on page 34.
|
| | The ownership percentages set forth above with respect to the
Combined Company do not take into account the redemption of any additional shares of Common Stock by the public stockholders or the issuance
of any Earnout Shares, which include up to 1,000,000 Earnout Shares to be distributed to the Sponsor and up to 2,000,000 Earnout Shares
to be distributed to DLQ Management, if certain milestones are achieved after the business combination. If the actual facts are different
from these assumptions (which they are likely to be), the percentage ownership retained by the Abri stockholders will be different. See
“Unaudited Pro Forma Condensed Combined Financial Information.” |
| Q. | What equity stake will the Sponsor and its affiliates hold
in the Combined Company, and what is the value of such interest? |
| A. | In connection with the Second Extension
Meeting held on August 7, 2023, public stockholders of Abri Common Stock requested redemption
of 570,224 shares or 45% of the public shares of Common Stock. Immediately after Closing,
assuming no additional redemption of shares of Common Stock for cash, the Sponsor and any
affiliates will retain an ownership interest of approximately 12.5% in the Combined Company,
which will have an estimated value of $18.9 million based on the value of the Merger
Consideration at $10.00 per share, and taking into account the trading prices of $10.95 as
of September 25, 2023. Assuming maximum redemption of shares of Common Stock for cash,
the Sponsor will retain an ownership interest of approximately 13.1% in the Combined Company,
assuming that no Private Warrants held by the Sponsor are exercised. If the actual facts
are different from these assumptions (which they are likely to be), the percentage ownership
retained by the Sponsor and its affiliates will be different. |
| Q. | What is the cash value of the securities and any other consideration
that (i) the public holders of Common Stock, (ii) holders of Public Warrants, (iii) the Sponsor and its affiliates (iv) the
Representative and (v) the DLQ securityholders and DLQ Parent will receive pursuant to the Business Combination? |
| A. | After the Business Combination, after taking into account the
Management Earnout Shares, the Sponsor Earnout Shares and the payouts pursuant to the Warrant Revenue Sharing Side Letter (all more fully
described and defined herein), (a) assuming that no additional existing public stockholders exercise their redemption rights and (b)
all the milestones described below are achieved pursuant to the Merger Agreement, the Management Earnout Agreement and Sponsor Earnout
Agreement, (i) the public stockholders will own approximately 0.7 million shares of Common Stock or 4.9% of the issued Combined Company’s
shares of Common Stock, with a cash value of $6.8 million, based on the value of the Merger Consideration at $10.00 per share; or $20.5
million, based on the value of Common Stock at $30.00 post-Merger; (ii) the Abri Public Warrant holders will own approximately 5.7 million
shares of Common Stock, or 25.1% of the issued Combined Company’s shares of Common Stock upon exercise of the Public Warrants (assuming
the price of the Common Stock is above the exercise price of $11.50 per share) with cash proceeds of $65.9 million, and a cash value
of $172.0 million, based on the value of Common Stock at $30.00 post-Merger; (iii) the Sponsor and its affiliates will collectively own
up to 2,817,350 shares of Common Stock, or 12.3% of the issued Combined Company’s shares of Common Stock with a cash value of $84.5
million, including the Sponsor Earnout Shares and the underlying Common Stock from the cashless exercise of the Abri Private Warrants
(assuming the price of the Common Stock is at $16.50 when the Private Warrants are exercised at $11.50), based on the value of the Common
Stock at $30.00 post-Merger; (iv) the Representative (as defined below) will own 238,506 shares of Common Stock, or 1.1% of the issued
Combined Company’s shares of Common Stock with a cash value of $7.2 million (assuming the price of Common Stock is at $16.50 when
the Unit Purchase Option and the underlying warrants are exercised at $11.50 on a cashless basis), based on the value of the Common Stock
at $30.00 post-Merger; (v) after the issuance of the Dividend Shares DLQ Parent will own 6,038,000 shares of Common Stock, or 26.4% of
the issued Combined Company’s shares of Common Stock with a cash value of $181 million, based on the value of the Common Stock
at $30.00 when the 2,000,000 Management Earnout Shares are fully achieved (but not including any Dividend Shares that may be distributed
to them from DLQ Parent) ; (vi) DLQ Parent Stockholders will own 3.762.000 shares of Common Stock, or 16.4% of the issued Combined Company’s
shares of Common Stock with a cash value of $112.9 million, based on the value of the Common Stock at $30.00; and certain members of
DLQ Management will own 2,000,000 shares of Common Stock, or 8.7% of the issued Combined Company’s shares of Common Stock with
a cash value of $60 million, based on the value of the Common Stock at $30.00 when the 2,000,000 Management Earnout Shares are fully
achieved (but not including any Dividend Shares that may be distributed to them from DLQ Parent). If the price of Common Stock is below
$11.50 per share and there is no exercise of Abri Warrants, these percentages will change. If any of the remaining public stockholders
exercise their redemption rights, the anticipated percentage ownership of Abri’s existing stockholders will be reduced. Please
see page 34 for a full analysis of the different redemption scenarios “Ownership of the Combined Company After the Closing”. |
| ● | First Milestone Event: the closing price of the shares of Abri
Common Stock is greater than or equal to $16.50 per share over any twenty (20) consecutive trading days during the first year
after Closing (the “First Milestone Event”); |
| ● | Second Milestone Event: the closing price of the shares of Abri
Common Stock is greater than or equal to $23.00 per share over any twenty (20) consecutive trading days during the first two years
after Closing (the “Second Milestone Event”); |
| ● | Third Milestone Event: the closing price of the shares of Abri
Common Stock is greater than or equal to $30.00 per share over any twenty (20) consecutive trading days during the first three years
after Closing (the “Third Milestone Event”). |
| Q. | If the Abri Public Warrants are exercised, how will the proceeds
be paid? |
| A: | In the event the price of Common Stock is greater than or equal
to $16.50 per share over any twenty (20) consecutive trading days, the Public Warrants may be redeemed for $0.01 per Public Warrant unless
the holder thereof exercises such Public Warrant. If the Public Warrants are exercised at $11.50 per share, the proceeds will be distributed
as follows: 80% to Abri, and 20% to the Sponsor. For more information, see “Summary of the Proxy statement — Agreements
to be Executed at Closing — Warrant Revenue Sharing Side Letter.” The actual proceeds will depend on the number of Public
Warrants exercised. If 100% of the Public Warrants are exercised, the proceeds will be distributed as follows: $52,752,064 (or 80%) to
Abri, $13,188,016 (or 20%) to the Sponsor. |
| Q: | Do Abri’s Public Warrant holders have different rights
to those held by Private Warrant holders? |
| A: | Upon Closing, the Abri Private Warrants will be identical to
the Public Warrants. Currently, so long as the Private Warrants are held by Abri’s Sponsor or its permitted transferees, they a)
will not be redeemable by Abri, and b) can be exercisable on a cashless basis. If the Private Warrants are held by holders other than
Abri’s Sponsor or its permitted transferees, the Private Warrants will be redeemable by Abri in all redemption scenarios and exercisable
by the holders on the same basis as the Public Warrants. No Public Warrants will be exercisable for cash unless Abri has an effective
and current registration statement covering the shares of Common Stock issuable upon exercise of the Public Warrants and a current prospectus
relating to such shares, and unless the last sales price of Abri’s shares of Common Stock equals or exceeds $16.50 per share for
any 20 trading days within a 30 trading day period ending three business days before they send the notice of redemption.
We believe it is Abri’s current intention to have an effective and current registration statement covering the shares of Common
Stock issuable upon exercise of the Public Warrants and a current prospectus relating to such shares in effect promptly following consummation
of an Initial Business Combination. Notwithstanding the foregoing, if a registration statement covering the shares of Common Stock issuable
upon exercise of the Public Warrants is not effective within 90 days following the consummation of the Initial Business Combination,
Public Warrant holders may, until such time as there is an effective registration statement and during any period when Abri shall have
failed to maintain an effective registration statement, exercise Public Warrants on a cashless basis. If the foregoing conditions are
satisfied and Abri issues a notice of redemption, each Public Warrant holder can exercise his, her or its warrant prior to the scheduled
redemption date. However, the price of the shares of Common Stock may fall below the $16.50 trigger price as well as the $11.50 warrant
exercise price per share after the redemption notice is issued and limit Abri’s ability to complete the redemption. |
| Q: | Will the holders of Public Warrants be notified when the Public
Warrants become eligible for redemption? |
| A: | If the conditions to redeem the Public Warrants are satisfied,
Abri shall fix a date for the redemption (the “Redemption Date”) to redeem the Public Warrants at a price of
$0.01 per Public Warrant (“Redemption Price”). Notice of redemption shall be mailed by first class mail, postage
prepaid, not less than 30 days prior to the date fixed for redemption to the registered holders of the Public 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. The Public Warrants may be exercised at
any time after notice of redemption shall have been given and prior to the Redemption Date; provided that Abri may require the registered
holder to exercise the Public Warrants on a cashless basis. On and after the Redemption Date, the registered holder of the Warrants shall
have no further rights except to receive, upon surrender of the Warrants, the Redemption Price. |
| Q: | Do any of our directors or officers have interests that may
conflict with my interests with respect to the Business Combination? |
| A: | In considering the recommendation of the Board to approve the
Merger Agreement, our stockholders should be aware that certain of Logiq and DLQ executive officers and directors may be deemed to have
interests in the Business Combination that are different from, or in addition to, those of our stockholders generally. These interests,
which may create actual or potential conflicts of interest, are, to the extent material, described in the section entitled “Proposal No.
1 — The Business Combination Proposal — Interests of Certain Persons in the Business Combination”
beginning on page 114. Abri’s Current Charter provides that to the extent allowed by law, the doctrine of corporate opportunity
shall not apply with respect to Abri’s officers or directors in circumstances where the application of such doctrine would conflict
with any fiduciary duties or contractual obligations they may have. This provision had no impact on Abri’s search for an acquisition
target. |
| Q: | What is the financial risk to the Sponsor and its affiliates
with respect to the Business Combination? |
| A: | If an initial business combination, such as the Business Combination,
is not completed by February 12, 2024, Abri will be required to dissolve and liquidate. In such event, the 1,433,480 founder shares currently
held by the Initial Stockholders, which were acquired prior to the IPO will be worthless because such holders have agreed to waive their
rights to any liquidation distributions. The founder shares were purchased for an aggregate purchase price of $25,000. In addition, the
294,598 Private Units purchased by the Sponsor for a total purchase price of $2,945,980, will be worthless. The Units had an aggregate
market value of approximately $3,240,578 based on the closing price of Units on the Nasdaq Stock Market as of September 25, 2023. Furthermore,
any working capital loans and the extension payments extended to Abri by the Sponsor that are not paid back at the close of the Business
Combination will be forgiven. As of January 31, 2023, the Sponsor has extended $1,450,000 of working capital loans through five promissory
notes, and an additional $1,146,784 for two payments of $573,392 for the two three-month extensions. On February 6, 2023, March 10, 2023,
April 11, 2023, May 11, 2023, June 9, 2023 and July 10, 2023, Abri deposited $87,500 into the Trust Account for each one-month extension
(or a total of $525,000) to extend the time to complete a business combination to August 12, 2023, bringing the total amount of extension
payments to $1,671,784 through July 12, 2023. There are no additional out of pocket expenses. If the Business Combination is not consummated,
the aggregate amount of approximately $6,267,764 will be lost. This includes $2,945,980 invested, the $1,650,000 in working capital loans
as of June 30, 2023 and extension payments of $1,671,784 paid to Abri through July 12, 2023. |
| Q: | What interests does the Sponsor and its affiliates have in
the Business Combination? |
| A: | The Sponsor, members of the Board and Abri’s executive
officers and advisors have interests in the Business Combination that are different from or in addition to (and which may conflict with)
your interest. These interests include: |
| ● | At an
Extension Meeting of Abri’s stockholders held on December 9, 2022, Abri’s stockholders approved (i) a proposal to amend Abri’s
amended and restated certificate of incorporation, and (ii) a proposal to amend the Management Trust Agreement with the Transfer Agent,
to extend the date by which Abri has to consummate a business combination from February 12, 2023 until August 12, 2023, on an as needed,
month-to-month basis (each an “Extension”), by depositing an additional $87,500 (a “Contribution”)
into the Trust Account for each such one-month Extension (referred to as the “December 9 Amendments”).
The Sponsor would make aggregate Contributions in the amount of $525,000 to extend the time to complete a business combination to August
12, 2023. |
| ● | On August 7, 2023, at the Second Extension Meeting, the Abri
stockholders approved the proposal to amend Abri’s Charter: (a) giving Abri the right to extend the date by which it has to complete
a business combination to February 12, 2024 without making any further deposits into the Trust Account, and (b) to change the Abri Charter
by removing the requirement to have net tangible assets of at least $5,000,001 upon consummation of a Business Combination. |
| ● | If an initial business combination, such as the Business Combination,
is not completed by February 12, 2024, Abri will be required to dissolve and liquidate. |
| ● | Each Contribution will be deposited in the Trust Account within
two (2) business days prior to the beginning of the additional Extension period. If Abri extends the time to complete a business combination
to August 12, 2023, the Sponsor would make aggregate Contributions in the amount of $525,000. |
| ● | If the Business Combination is not approved, in accordance with Abri’s
Charter, the 1,433,480 founder shares held by its Sponsor, its officers and directors, which were acquired prior to the IPO for an aggregate
purchase price of $25,000, will be worthless (as the holders have waived liquidation rights with respect to such shares), as will the
294,598 shares of Common stock and 294,598 Private Warrants that were included in the Private Units acquired simultaneously with the IPO
and in connection with the exercise of the overallotment option, for an aggregate purchase price of $2,945,980. Irrespective of existing
lock-up agreements that impose restrictions on the transfer of the founder shares, the shares of Common Stock in the Private Units and
Private Warrants, such founder shares together with the shares of Common Stock in the Private Units, and Private Warrants had an aggregate
market value of approximately $3,249,416 based on the last sale price of $10.95 and $0.008, respectively, on Nasdaq on September 25, 2023. |
| ● | The Sponsor may receive up to $13,188,016 (or 20%) of the proceeds
of the exercise of the Public Warrants, if the Public Warrants are exercised at $11.50 per share. The Public Warrants may be redeemed
for $0.01 per Public Warrant unless the holder thereof exercises such Public Warrant, so long as the price per share of the Combined
Company stock is above $16.50 for over any twenty (20) consecutive trading days. For more information, see “Summary of the Proxy
statement — Agreements to be Executed at Closing — Warrant Revenue Sharing Side Letter”; |
| ● | the fact that the Sponsor may receive up to 1,000,000 Earnout
Shares if the Combined Company achieves certain milestones as follows: |
| ● | 250,000 Sponsor Earnout Shares will
be earned and released upon satisfaction of the First Milestone Event (as defined in the
Sponsor Earnout Agreement), which would have a value of $4,125,000 with the stock price at
$16.50; |
| ● | 350,000 Sponsor Earnout Shares will
be earned and released upon satisfaction of the Second Milestone Event (as defined in the
Sponsor Earnout Agreement), which, including the first tranche of 250,000 Earnout Shares,
would have a total value of $13,800,000 with the stock price at $23.00; and |
| ● | 400,000 Sponsor Earnout Shares will
be earned and released upon satisfaction of the Third Milestone Event (as defined in the
Sponsor Earnout Agreement), which, including the first tranche of 250,000 Earnout Shares
plus the second tranche of 350,000 Earnout Shares, would have a total value of $30,000,000
with the stock price at $30.00. |
| ● | If the Business Combination is completed, assuming the stock
price of the Combined Company is $30.00 per share, and (i) the Public Warrants are exercised; (ii) the Private Warrants are exercised
on a cashless exercise basis; (iii) all Earnout Share Milestones are achieved; and (iv) the Sponsor and its affiliates still hold 1,728,078
shares of Common stock (which includes 1,433,480 founder shares plus 294,598 shares included in the Private Units), the Sponsor stands
to gain up to $13,188,016 for the exercise of the Public Warrants; $2,678,164 in value for the 89,272 shares with the cashless exercise
of the Private Warrants; $30,000,000 in value of the Earnout Shares; and $51,842,340 in value of the 1,728,078 shares held, for a total
of $97,708,520. |
| ● | On March
8, 2022, Abri issued a convertible promissory note (the “First Working Capital Note”) to the Sponsor. Pursuant
to the First Working Capital Note, the Sponsor agreed to loan Abri an aggregate principal amount of $300,000. On April 4, 2022, Abri
issued a second convertible promissory note for an aggregate principal amount of $500,000 (the “Second Working Capital Note”)
to the Sponsor. On August 26, 2022, Abri issued a third convertible promissory note for an aggregate principal amount of $300,000 (the
“Third Working Capital Note”) to the Sponsor. On November 22, 2022, Abri issued a fourth convertible promissory
note for an aggregate principal amount of $150,000 (the “Fourth Working Capital Note”) to the Sponsor. On January
17, 2023, Abri issued a fifth convertible promissory note for an aggregate principal amount of $200,000 (the “Fifth Working
Capital Note”) to the Sponsor. On February 10, 2023, Abri issued a sixth convertible promissory note for an aggregate principal
amount of $150,000 (the “Sixth Working Capital Note”) to the Sponsor and on July 31, 2023, Abri issued
a seventh working capital note in the amount of $11,250 (the “Seventh Working Capital Note”) to the Sponsor
(the First Working Capital Note through the Seventh Working Capital Notes are
hereinafter referred to as the “Working Capital Notes”). The Working Capital Notes were issued to fund working
capital of Abri. The Working Capital Notes are non-interest bearing and all outstanding amounts under the Working Capital Notes will
be due on the date on which Abri consummates our initial business combination (the “Maturity Date”); |
| ● | On August 5, 2022, Abri deposited
$573,392 into the trust account of ABRI (the “Trust Account”),
to extend the time to complete a Business Combination until November 12, 2022. On November
1, 2022, Abri deposited $573,392 into the Trust Account for the second of two three-month
extensions to extend the time to complete a Business Combination until February 12, 2023. |
| ● | On February 6, 2023, March 10, 2023,
April 11, 2023, May 11, 2023, June 9, 2023 and July 10, 2023, Abri deposited $87,500 for
each one-month extension (or $525,000 in total) into the Trust Account to extend the time
to complete a business combination to August 12, 2023. On August 7, 2023, at Abri’s
Second Extension Meeting, the stockholders approved a proposal to extend the date to complete
a business combination to February 12, 2024 with no additional amounts to be deposited into
the Trust Account. |
| ● | If
Abri is unable to complete a business combination and distribute the proceeds held in the Trust Account to its public stockholders, its
Sponsor has agreed (subject to certain exceptions) that it will be liable to ensure that the proceeds in the Trust Account are not reduced
below $10.00 per share by the claims of target businesses or claims of vendors or other entities that are owed money by Abri for services
rendered or contracted for or products sold to Abri; |
| ● | All rights specified in Abri’s
Charter as amended on December 9, 2022 and August 9, relating to the right of officers and
directors to be indemnified by Abri and of Abri’s officers and directors to be exculpated
from monetary liability with respect to prior acts or omissions, will continue after a business
combination. If the Business Combination is not approved and Abri liquidates, Abri will not
be able to perform its obligations to its officers and directors under those provisions.
|
| ● | The exercise of Abri’s directors’
and officers’ discretion in agreeing to changes or waivers in the terms of the transaction
may result in a conflict of interest when determining whether such changes or waivers are
appropriate and in our stockholders’ best interest. |
| ● | Abri’s Sponsor, officers, directors,
initial stockholders or their affiliates, are entitled to reimbursement of out-of-pocket
expenses incurred by them in connection with certain activities on their behalf, such as
identifying and investigating possible business targets and business combinations. However,
if Abri fails to consummate the Business Combination, they will not have any claim against
the Trust Account for reimbursement. Accordingly, Abri will most likely not be able to reimburse
these expenses if the Business Combination is not completed, including any balances outstanding
on any Working Capital Notes, as described herein, issued to Abri by the Sponsor. As of June
30, 2023, $1,650,000 is outstanding from the Working Capital Notes, $1,146,784 for two payments
of $573,392 for the two three-month extensions, plus five payments of $87,500 ($437,500)
for a one-month extension, and there are no out-of-pocket expenses owed to Abri’s officers,
directors or Sponsor. |
| ● | If
a business combination is not consummated, and there are insufficient funds to repay the
Working Capital Notes, the automatic extension payments of $1,146,784, the six one-month
extension payments of $87,500 for a total of $1,671,784 in extension payments through August
12, 2023, and any further Extension payments made, all unpaid amounts would be forgiven.
All or a portion of the amounts outstanding under the Working Capital Notes may be converted
on the Maturity Date into Units at a price of $10.00 per Unit at the option of the Sponsor.
The Units would be identical to Abri’s outstanding Private Units that were issued to
the Sponsor in the Private Placement. The Working Capital Notes contain customary events
of default, including, among others, those relating to Abri’s failure to make a payment
of principal when due and to perform any other obligations that is not timely cured after
written notice of such default from the Sponsor. |
| Q: | Are there any arrangements to help ensure that Abri will have
sufficient funds, together with the proceeds in its Trust Account, to fund the consideration? |
| A: | Yes. To the extent not utilized to consummate the Business Combination,
the proceeds from the Trust Account will be used for general corporate purposes, including, but not limited to, working capital for operations,
capital expenditures and future acquisitions. |
Further, on September 5, 2023, DLQ
entered into an agreement with certain institutional investors (the “Investors”) for a $5 million investment in DLQ
(the “DLQ Investment”) in the form of convertible promissory notes issued by DLQ (the “DLQ Notes”).
The DLQ Notes shall convert into such number of shares of common stock of DLQ (the “Conversion Shares”), that
would be exchanged for 1,600,000 Merger Consideration Shares at the Closing. Certain non-affiliated stockholders of DLQ will separately
escrow 1,500,000 Merger Consideration Shares which may be issued to the Investors to cover any reset in the amount of Merger Consideration
Shares to cover the DLQ Investment amount until the DLQ Investment has been recouped by the Investors. In addition, the Management Shares
shall be placed in an escrow account until DLQ Investment amount until the DLQ Investment has been recouped by the Investors.
The DLQ Investment funds have been
put into an escrow account and will be released at Closing to pay certain fees and expenses in connection with the Business Combination,
including closing costs including the deferred underwriter’s fee and for working capital. To the extent not utilized to consummate
the Business Combination, the remaining proceeds from the DLQ Investment and the proceeds from the Trust Account after redemptions will
be used for general corporate purposes, including, but not limited to, working capital for operations, capital expenditures and future
acquisitions. Investors have also received a $5 million convertible note issued by DLQ Parent (the “LGIQ Note”),
which shall, at the option of the Investors, convert into such number of shares of Common Stock of DLQ Parent (“LGIQ Shares”)
derived by dividing $5 million by the volume weighted average share price of LGIQ on the day before the date of conversion.
To the extent not utilized to consummate
the Business Combination, the proceeds from the Trust Account after redemptions will be used for general corporate purposes, including,
but not limited to, working capital for operations, capital expenditures and future acquisitions. There have been no other marketing
activities to date to secure financing from other unaffiliated or external parties.
If the Combined Company needs additional
capital, DLQ, the Company, Abri, and the Sponsor have agreed that Sponsor shall be the exclusive financing source of capital to fund
the Combined Company after the Business Combination of up to $30 million, which capital shall be sourced by the Sponsor through debt
or equity financings based upon acceptable market conditions available at that time.
In connection with Abri’s Extension
Meeting held on December 9, 2022, where the stockholders approved certain proposals giving Abri the right to extend the date by which
it has to complete a business combination six (6) times for an additional one (1) month each time, from February 12, 2023 to August 12,
2023, a total of 4,481,548 shares were tendered for redemption. Approximately $45,952,279 was withdrawn from Abri’s Trust Account.
On August 7, 2023, Abri held a second
special meeting of shareholders (the “Second Extension Meeting”) In connection with Abri’s Second Extension
Meeting, the stockholders approved a proposal to extend the date to complete a business combination to February 12, 2024 and to remove
the net tangible asset provision in the charter. In connection with the Second Extension Meeting, 570,224 shares were tendered for redemption.
As a result, approximately $6.05 million (approximately $10.62 per share), after deducting allowable taxes, will be removed Abri’s
trust account to pay such holders.
Following redemptions, Abri has 682,148
public shares of common stock outstanding. As a result of the redemptions, Abri now has less liquidity and fewer round-lot holders of
its public shares, which may make it more difficult to meet Nasdaq listing requirements. Since it is a condition to closing to receive
the approval for listing by Nasdaq of the shares of Abri’s Common Stock to be issued in connection with the transactions contemplated
by the Merger Agreement, Abri’s reduced public float may make it more difficult for Abri to meet one of the Nasdaq listing requirements,
and to consummate the Business Combination.
| Q: | What is the potential impact of redemptions on the per share
value of the shares owned by non-redeeming stockholders? |
| A: | If Abri stockholders elect to redeem their shares of Common Stock,
the stock price per share of Common Stock may drop. Therefore, holders of Common Stock may experience a reduction in the value of their
ownership of shares of Common Stock if they do not elect to redeem their shares. Please see “Summary of the proxy statement — Net
Loss and Net Book Value Per Share Calculation.” |
| Q: | What are the reasons for the Board’s recommendation
regarding the Business Combination with DLQ? |
| A: | The DLQ and DLQ Parent’s Board considered both positive
and negative factors when recommending this transaction. It considered the current software services already offered by DLQ, the establishment
of an existing platform that has been expanding through acquisition, and the growing revenue base. The Board also considered the extensive
competitive landscape for similar products and services and the risks associated with intellectual property protection, along with the
ability of the Combined Company to create or acquire additional intellectual property. This transaction was negotiated between unrelated
parties with no pre-existing relationship and no conflicts of interest were present. |
| Q. | What are the material U.S. federal income tax consequences
of the Business Combination? |
| A: | The material U.S. federal income tax considerations that
may be relevant in respect of the Business Combination are discussed in more detail in the section titled “Material U.S. Federal
Income Tax Consequences of the Business Combination to U.S. Holder of DLQ Common Stock.” The discussion of the U.S. federal
income tax consequences contained in this proxy statement is intended to provide only a general discussion and is not a complete analysis
or description of all of the U.S. federal income tax considerations that are applicable to you in respect of the Business Combination,
nor does it address any tax considerations arising under U.S. state or local or non-U.S. tax laws. |
| Q: | What do I need to do now? |
| A: | You are urged to read carefully and consider the information
contained in this proxy statement, including the annexes, and to consider how the Business Combination will affect you as a stockholder.
You should then vote as soon as possible in accordance with the instructions provided in this proxy statement and on the enclosed proxy
card or, if you hold your shares through a brokerage firm, bank or other nominee, on the voting instruction form provided by the broker,
bank or nominee. |
| Q: | If my shares are held in “street name” by my bank,
brokerage firm or nominee, will they automatically vote my shares for me? |
| A: | No. If you are a beneficial owner and you do not provide voting
instructions to your broker, bank or other holder of record holding shares for you, your shares will not be voted with respect to any
Proposal for which your broker does not have discretionary authority to vote. If a Proposal is determined to be discretionary, your broker,
bank or other holder of record is permitted to vote on the Proposal without receiving voting instructions from you. If a Proposal is
determined to be non-discretionary, your broker, bank or other holder of record is not permitted to vote on the Proposal without receiving
voting instructions from you. A “broker non-vote” occurs when a bank, broker or other holder of record holding shares for
a beneficial owner does not vote on a non-discretionary proposal because the holder of record has not received voting instructions from
the beneficial owner. |
Each of the Proposals to be presented at the Meeting is a non-discretionary
proposal. Accordingly, if you are a beneficial owner and you do not provide voting instructions to your broker, bank or other holder of
record holding shares for you, your shares will not be voted with respect to any of the Proposals. A broker non-vote would have the same
effect as a vote “AGAINST” the Reverse Stock Split Proposal, and will have no effect on the vote for any other Proposal.
| Q: | What if I abstain from voting or fail to instruct my bank,
brokerage firm or nominee? |
| A: | Logiq will count a properly executed proxy marked “ABSTAIN”
with respect to a particular Proposal as present for the purposes of determining whether a quorum is present at the Meeting. For purposes
of approval, an abstention on any of the Proposals will have the same effect as a vote “AGAINST” such Proposal. The Business
Combination is not conditioned upon the approval of any other Proposal. |
| Q: | What will happen if I return my proxy card without indicating
how to vote? |
| A: | If you sign and return your proxy card without indicating how
to vote on any particular Proposal, the shares of Common Stock represented by your proxy will be voted in favor of each Proposal. Proxy
cards that are returned without a signature will not be counted as present at the Meeting and cannot be voted. |
| Q: | When is the Business Combination expected to occur? |
| A: | Assuming the requisite regulatory and stockholder approvals are
received, it is expected that the Business Combination will occur as soon as possible following the Meeting. |
| Q: | Is Abri’s stockholder approval required to approve the
Business Combination? |
| A: | Yes. The Abri stockholders are required to approve the Business
Combination and have filed a Form S-4 registration statement and proxy statement to facilitate such vote. |
| Q: | Is DLQ’s stockholder required to approve the Business
Combination? |
| A: | Yes. DLQ Parent and DLQ’s sole stockholder, Logiq, Inc.
is required to approve the Business Combination. |
| Q: | Are DLQ Parent’s stockholders required to approve the
Business Combination? |
| A: | Yes. The DLQ Parent stockholders are required to approve the Business
Combination and you are receiving this Proxy Statement to facilitate such vote. |
| Q: | Are there risks associated with the Business Combination that I
should consider in deciding how to vote? |
| A: | Yes. There are a number of risks related to the Business Combination
and other transactions contemplated by the Merger Agreement, that are discussed in this proxy statement. Please read with particular
care the detailed description of the risks described in “Risk Factors” beginning on page 50 of this proxy statement. |
| Q: | May I seek statutory appraisal rights or dissenter rights
with respect to my shares? |
| A: | No. Appraisal rights are not available to holders of shares of
Abri or DLQ Parent Common Stock in connection with the proposed Business Combination. For additional information, see the section titled
“The Meeting — Appraisal Rights.” |
| Q: | What happens if the Business Combination is not consummated? |
| A: | If Abri does not consummate the Business Combination by February 12, 2024
then pursuant to Article VI its current Amended and Restated Certificate of Incorporation, as amended on December 9, 2022 and August 9,
2023, Abri’s officers must take all actions necessary in accordance with the Delaware General Corporation Law to dissolve and liquidate
Abri as soon as reasonably possible. Following dissolution, Abri will no longer exist as a company. In any liquidation, the funds held
in the Trust Account, plus any interest earned thereon (net of taxes payable), together with any remaining out-of-trust net assets, will
be distributed pro-rata to holders of shares of Common Stock who acquired such shares in the IPO or in the aftermarket. The estimated
consideration that each share of Common Stock would be paid at liquidation would be approximately $10.68 per share for stockholders based
on amounts on deposit in the Trust Account as of September 25, 2023. The closing price of Abri’s Common Stock on the Nasdaq Stock
Market as of September 25, 2023 was $10.95. The Initial Stockholders waived the right to any liquidation distribution with respect to
any shares of Common Stock held by them. |
| Q: | What happens to the funds deposited in the Trust Account following
the Business Combination? |
| A: | Following Closing, holders of pubic shares of Abri exercising redemption
rights will receive their per share redemption price out of the funds in the Trust Account. The balance of the funds will be released
to DLQ to fund working capital needs of the Combined Company. As of September 25, 202023, there was approximately $7,285,885 in the Trust
Account. Abri estimates that approximately $10.68 per outstanding Public shares of Abri Common Stock will be paid to the investors exercising
their redemption rights. |
| Q: | Will the Combined Company be a “Controlled Company”
after the Business Combination? |
| A: | In connection
with the Extension Meeting held on December 9, 2022, where stockholders approved to extend the time Abri has to consummate a Business
Combination up to August 12, 2023, 4,481,548 shares of Common Stock were tendered for redemption, or 78% of the publicly held shares.
In connection with the Second Extension Meeting held on August 7, 2023, where stockholders approved to extend the time Abri has
to consummate a Business Combination up to February 12, 2024 with no additional deposits to the Trust Account, public stockholders of
Abri Common Stock requested redemption of 570,224 shares or 45% of the public shares of Common Stock. Therefore,
at Closing, DLQ Parent will beneficially own a majority of Abri Common Stock, or 49.8% of the Combined Company, without taking into account
the redemption of any additional shares of Common Stock by the public stockholders or the issuance of any Earnout Shares, which include
up to 1,000,000 Earnout Shares to be distributed to the Sponsor and up to 2,000,000 Earnout Shares to be distributed to DLQ Management,
if certain milestones are achieved after the business combination. For more information about DLQ Parent, see “Security Ownership
of Certain Beneficial Owners and Management.” As a result, DLQ would be a “controlled company” within the meaning
of the Nasdaq listing rules. Under these rules, a listed company of which more than 50% of the voting power is held by an individual,
group or another company is a “controlled company” and may elect to not comply with certain corporate governance requirements,
including the requirement that a majority of the board of directors consist of independent directors, the requirement that the nominating
committee is composed entirely of independent directors and the requirement that the compensation committee is composed entirely of independent
directors. Of the shares owned by DLQ Parent, 3,762,000 of such shares will be owned by DLQ Parent’s public stockholders of which
1.8% is currently owned by DLQ Management, who in the event they receive all 2,000,000 of the Earnout Shares, together with the 6,038,000
shares owned by DLQ Parent, will control 46.4% of the Combined Company. As a result of the Combined Company’s “controlled
company” status, and if the Combined Company elects to rely on the exemptions afforded to it as a “controlled company,”
the securityholders of the Combined Company may be afforded less protection under the Nasdaq listing rules and SEC regulations than other
public companies. For further information on the anticipated management of the Combined Company, see “Risk Factors — Risks
Related to DLQ Becoming a NASDAQ Traded Company After the Business Combination — As a “controlled company,” DLQ can
rely on exemptions from certain corporate governance requirements that provide greater protection to stockholders of other companies.”
and “Directors and Executive Officers of the Combined Company after the Business Combination — Combined Company Exemption.” |
| Q. | Who will manage the Combined Company after the Business Combination? |
| A. | As a condition to Closing, all of the officers and directors of
Abri will resign. The Combined Company will have five (5) directors. The Sponsor has the right to designate three (3) directors. DLQ
has the right to designate two (2) directors who shall include the sole member of DLQ’s board of directors before Closing. Because
the Combined Company will be deemed a “control company” within the meaning of the Nasdaq listing rules, it may elect to not
comply with certain corporate governance requirements, including the requirement that a majority of the board of directors consist of
independent directors, the requirement that the nominating committee is composed entirely of independent directors and the requirement
that the compensation committee is composed entirely of independent directors. majority of these directors will be independent directors.
As a result of DLQ Parent’s “controlled company” status, and if the Combined Company elects to rely on the exemptions
afforded to it as a “controlled company,” stockholders may be afforded less protection under the Nasdaq listing rules and
SEC regulations than other public companies. For information on the anticipated management of the Combined Company, see “Directors
and Executive Officers of the Combined Company After the Business Combination.” |
| Q. | What shares can I vote at the Meeting? |
| A. | You may vote all of the shares of Logiq Common Stock owned by
you as of the Record Date, including (i) shares held directly in your name as the stockholder of record, and (ii) shares held for you
as the beneficial owner through a broker, trustee, or other nominee such as a bank. |
| Q. | What is the difference between holding shares as a stockholder
of record and as a beneficial owner? |
| A. | Some of our stockholders may hold shares of Logiq Common Stock
in their own name rather than through a broker or other nominee. As summarized below, there are some distinctions between shares held
of record and those owned beneficially. |
Stockholders of Record. If
your shares are registered directly in your name with our transfer agent, Nevada Agency and Trust Company, you are considered to be,
with respect to those shares, the stockholder of record, and the Proxy Statement was sent directly to you. As the stockholder of record,
you have the right to vote virtually at the Meeting and to vote by proxy. Whether or not you plan to attend the Meeting, Logiq urges
you to vote by Internet, by phone or by mail to ensure your vote is counted. You may still attend the Meeting and vote virtually if you
have already voted by proxy.
Beneficial Owner. If your shares
are held in a brokerage account or by another nominee, you are considered the beneficial owner of shares held in “street name,”
and these Proxy Materials, together with a voting instruction card, are being forwarded to you from that organization. As the beneficial
owner, you have the right to direct your broker, trustee, or nominee how to vote on your behalf and are also invited to attend the Meeting.
Please note that since a beneficial owner is not the stockholder of record, you may not vote these shares virtually at the Meeting unless
you obtain a “legal proxy” from the broker, trustee, or nominee that holds your shares, giving you the right to vote the
shares at the Meeting. If this applies to you, your broker, trustee, or nominee will have enclosed or provided voting instructions for
you to use in directing the broker, trustee, or nominee how to vote your shares.
| Q. | How can I vote my shares without attending the Meeting? |
| A. | Whether you hold shares directly as the stockholder of record
or beneficially in street name, you may direct how your shares are voted without attending the Meeting. If you are a stockholder of record,
you may vote by proxy by Internet, by phone or by mail by following the instructions provided in the Proxy Statement mailed to you. If
you return your signed proxy card to us before the Meeting, Logiq will vote your shares as you direct. Stockholders who hold shares beneficially
in street name may cause their shares to be voted by proxy in accordance with the instructions provided by their broker, trustee, or
nominee, by using the proxy card provided by the broker, trustee, or nominee and mailing them in the envelope provided by such person. |
| Q. | How can I vote my shares virtually at the Meeting? |
| A. | Stockholders who attend the virtual Meeting should follow the instructions at
www.virtualshareholdermeeting.com/LGIQ2023SM
to vote or submit questions during the Meeting. Voting online during the Meeting will replace any previous votes, and the online
polls will close at approximately 11:15 a.m. Eastern Standard Time on October 23, 2023 Record holders who received a copy of this
Proxy Statement and accompanying proxy card in the mail can vote by filling out the proxy card, signing it, and returning it in the
postage paid return envelope. Record holders can also vote by telephone at (808) 829-1057 or by Internet at www.proxyvote.com.
Voting instructions are provided on the proxy card. If you hold shares in street name, you must vote by giving instructions to your
bank, broker, or other nominee. You should follow the voting instructions on the form that you receive from your bank, broker, or
other nominee. |
| Q. | How do I attend the virtual Meeting? |
| A. | You may attend the Meeting online, including to vote and/or submit questions
during the Meeting by logging in at www.virtualshareholdermeeting.com/LGIQ2023SM. The Meeting will begin at approximately 11:00 a.m. Eastern
Standard Time, with log-in beginning at 10:45 a.m. on October 23, 2023. |
| Q. | How do I gain admission to the virtual Meeting? |
| A. | You are entitled to participate in the virtual Meeting only if you were
a stockholder of record who owned shares of Company Common Stock at the close of business on September 25, 2023, the Record Date. To attend
online and participate in the Meeting, stockholders of record will need to use the control number included on their proxy card to log
into www.virtualshareholdermeeting.com/LGIQ2023SM; beneficial owners who do not have a control number may gain access to the Meeting by logging
into their brokerage firm’s website and selecting the stockholder communication mailbox to link through to the virtual Meeting.
Instructions should also be provided on the voting instruction card provided by their broker, bank, or other nominee. |
Logiq encourages you to access the Meeting
prior to start time. Please allow time for online check-in, which will begin at 10:45 a.m. Eastern Standard Time. If you have difficulties
during the check-in time or during the Meeting, please call technical support at 1 (844) 986-0822 for U.S. based stockholders or
1 (303) 562-9302 for international based stockholders.
Stockholders have multiple opportunities
to submit questions to Logiq for the Meeting. Stockholders who wish to submit a question may do so in the question tab of the webcast
online during the Meeting at www.virtualshareholdermeeting.com/LGIQ2023SM.
| |
Q. |
How are votes counted? |
| |
A. |
If you provide specific instructions with regard to an item, your shares will be voted as you instruct on such item. If you sign your proxy card without giving specific instructions, your shares will be voted in accordance with the recommendations of the Board (“FOR” the Business Combination identified in Proposal 1, , “FOR” the Reverse Stock Split identified in Proposal 2, “FOR” the authorization for the board to adjourn identified in Proposal 3, and in the discretion of the proxy holder on any other matters that properly come before the Meeting). |
| |
Q: |
What vote is required to approve the Proposals? |
| |
A: |
Proposal No. 1 — The Business Combination
Proposal requires the affirmative vote of the majority of the issued and outstanding shares of Common Stock as of close of business on
the Record Date. An abstention will have the effect of a vote “AGAINST” Proposal No. 1. Broker non-votes will have no
effect on the vote for Proposal No. 1.
Proposal No. 2 – The Reverse Stock Split proposal
requires the affirmative (“FOR”) vote of at least a majority in voting power of the shares of our capital stock issued and
outstanding as of close of business on the Record Date. Abstentions will be counted toward the tabulation of votes cast on this proposal
and will have the same effect as “AGAINST” votes. Broker non-votes, if any, will have the same effect as “AGAINST”
votes. However, because we believe that this proposal will be treated as a routine matter, we do not expect to receive any broker non-votes
on this proposal
Proposal No. 3 - The Adjournment Proposal requires
the affirmative vote of the majority of the issued and outstanding shares of Common Stock present in person by virtual attendance or represented
by proxy and entitled to vote at the Meeting. Abstentions will have the effect of a vote “AGAINST” Proposal No. 3. Broker-non
votes have no effect on the vote for Proposal No. 3. The Adjournment Proposal, if adopted, will approve the chairman’s adjournment
of the Meeting to a later date to permit further solicitation of proxies. The Adjournment Proposal will only be presented to our stockholders
in the event, based on the tabulated votes, there are not sufficient votes received at the time of the Meeting to approve the other Proposals. |
| |
Q. |
What is a “broker non-vote”? |
| |
A. |
A broker non-vote occurs when a beneficial owner of shares held in street name does not give instructions to the broker or nominee holding the shares as to how to vote on matters deemed “non-routine.” Generally, if shares are held in street name, the beneficial owner of the shares is entitled to give voting instructions to the broker or nominee holding the shares. If the beneficial owner does not provide voting instructions, the broker or nominee can still vote the shares with respect to matters that are considered to be “routine,” but not with respect to “non-routine” matters. Under the rules and interpretations of the New York Stock Exchange (NYSE), “non-routine” matters are generally those involving a contest or a matter that may substantially affect the rights or privileges of stockholders, such as mergers, dissolutions, or stockholder proposals. The shares that cannot be voted by brokers and other nominees on non-routine matters but are represented at the Meeting will be deemed present at our Meeting for purposes of determining whether the necessary quorum exists to proceed with the Meeting, but will not be considered entitled to vote on the non-routine proposals. |
Logiq believes that Proposal 1 is considered
a non-routine matters under applicable rules. Accordingly, brokers or other nominees cannot vote on these proposals without instructions
from beneficial owners. Pursuant to our Current Bylaws, with regard to Proposal 1, broker non-votes will be excluded from the vote and
will have no effect on the outcome of such proposal.
Logiq believes that Proposal 2 is considered
a routine matter under the applicable rules. Accordingly, brokers or other nominees can vote on these proposals without instructions
f rom beneficial owners. Pursuant to our Current Bylaws, with regard to Proposal 2, broker non-votes will count toward the vote and would
be considered “AGAINST” the proposal, impacting the outcome of Proposal 2.
| Q. | are dissenters’
rights available with respect to any of the proposals? |
| A. | Dissenters’ rights are not available with respect to any
of the proposals to be voted on at the Meeting. |
| Q. | What should I do if I receive more than one Proxy Statement? |
| A. | If you receive more than one Proxy Statement,
your shares are registered in more than one name or are registered in different accounts.
Please follow the instructions on each Proxy Statement to ensure that all of your shares
are voted. |
| Q. | Can I change my mind after I return my proxy? |
| A. | Yes. You may change your vote at any time before your proxy is
voted at the Meeting. If you are a stockholder of record, you can do this by giving written notice to the Company’s Secretary,
by submitting another proxy with a later date, or by attending the Meeting and voting virtually. If you are a stockholder in “street”
or “nominee” name, you should consult with the bank, broker, or other nominee regarding that entity’s procedures for
revoking your voting instructions. |
| Q. | Who is soliciting my vote and who is paying the costs? |
| A. | Your vote is being solicited on behalf
of the Board, and Logiq will pay the costs associated with the solicitation of proxies, including
preparation, assembly, printing, and mailing of this Proxy Statement, as applicable. |
| Q. | How can I find out the results of the voting? |
| A. | Logiq intends to announce preliminary
voting results at the Meeting and publish final results in a Current Report on Form 8-K within
four business days following the Meeting. |
| Q. | Whom should I contact if I have questions? |
| A. | If you have any additional questions about
the Meeting or the proposals presented in this Proxy Statement, you should contact the following
person at our principal executive office as follows: |
Brent Suen
85 Broad Street, 16-079
New York, NY 10004
(808) 829-1057
Email: contact@logiq.com
SUMMARY OF THE PROXY STATEMENT
This summary highlights
selected information from this proxy statement but may not contain all of the information that may be important to you. Accordingly,
Logiq encourages you to read carefully this entire proxy statement, including the Merger Agreement, and amendments thereto, attached
as Annex A. Please read these documents carefully as they are the legal documents that govern the Business Combination
and your rights in the Business Combination.
Unless otherwise specified,
all share calculations assume no exercise of the redemption rights by Abri’s stockholders.
The Parties to the Business Combination
Abri SPAC I, Inc.
Abri was incorporated as a
blank check company formed under the laws of the State of Delaware on March 18, 2021. Abri was formed for the purpose of entering
into a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or other similar business combination
with one or more businesses or entities.
On August 12, 2021, Abri
consummated the IPO of 5,000,000 Units at $10.00 per Unit, generating gross proceeds of $50,000,000. Simultaneously with the
closing of the IPO, Abri consummated the sale of 276,250 Private Units at a price of $10.00 per Private Unit in a private placement
to the Sponsor and Chardan Capital Markets, generating gross proceeds of $2,762,500.
Abri granted the underwriters
in the IPO a 45-day option to purchase up to 750,000 additional Units to cover over-allotments, if any. On August 23, 2021,
the Underwriters partially exercised the over-allotment option to purchase 733,920 Units, generating an aggregate of gross proceeds
of $7,339,200. In connection with the underwriters’ exercise of their over-allotment option, Abri also consummated the sale of
an additional 18,348 Private Units at $10.00 per Private Unit to the Sponsor and Chardan Capital Markets, generating gross proceeds
of $183,480.
The amounts held in the Trust
Account may only be used by Abri upon the consummation of a business combination, except that there can be released to Abri, from time
to time, any interest earned on the funds in the Trust Account that it may need to pay its tax obligations. The remaining interest earned
on the funds in the Trust Account will not be released until the earlier of the completion of a business combination and Abri’s
liquidation. Abri executed the Merger Agreement on September 9, 2022 and it must liquidate unless a business combination is consummated
by August 12, 2023.
After deducting the underwriting
discounts, offering expenses, and commissions from the IPO and the sale of the Private Warrants, a total of $57,339,200 was deposited
into the Trust Account, and the remaining $1,000,000 of the net proceeds were outside of the Trust Account and made available to be used
for business, legal and accounting due diligence on prospective business combinations and continuing general and administrative expenses.
On December 9, 2022, Abri
held a special stockholder meeting where stockholders approved to extend the time to complete a Business Combination up to August 12,
2023, on a month-to-month basis. Approximately $45 million was paid out of the Trust Account for the redemption of 4,481,548 shares of
Common Stock.
As of June 30, 2023, Abri
had cash outside the Trust Account of $148,389 available for its working capital needs. As of June 30, 3023, there was approximately
$13.7 million held in the Trust Account.
At the special meeting of
stockholders held on December 9, 2022 (the “Extension Meeting”), Abri stockholders approved an amendment to
Abri’s amended and restated certificate of incorporation (the “Original Charter Amendment Proposal”)
and an amendment to the Investment Management Trust Agreement with Continental Stock Transfer & Trust Company, dated August 9, 2022
(the “Trust Agreement Proposal”), giving Abri the right to extend the time to consummate the Business Combination
six (6) times for an additional one (1) month each time by depositing into the Trust Account $87,500 for each one-month extension, up
to August 12, 2023 (the first two extensions to February 23, 2023 were already made). Amendments to the amended and restated certificate
of incorporation and to the Trust Agreement are referred to herein collectively as the “December 9 Amendments.”
In connection with the Extension
Meeting, a total 4,481,548 shares were tendered for redemption. Approximately $45,711,789 was withdrawn from Abri’s Trust Account
(the “Trust Account”) to pay for the redemption, leaving approximately $13.2 million in the Trust Account as
of March 31, 2023, inclusive of the last two Extension Payments. As a result of the redemptions, Abri now has less liquidity and fewer
round-lot holders of Abri’s public shares, which may make it more difficult to meet Nasdaq listing requirements.
On August 7, 2023, Abri held
a second special meeting of shareholders (the “Second Extension Meeting”) In connection with Abri’s Second
Extension Meeting, the stockholders approved a proposal to extend the date to complete a business combination to February 12, 2024 and
to remove the net tangible asset provision in the charter. In connection with the Second Extension Meeting, 570,224 shares were tendered
for redemption. As a result, approximately $6.05 million (approximately $10.62 per share), after deducting allowable taxes, will be removed
from Abri’s trust account to pay such holders. Following redemptions, Abri has 682,148 public shares of common stock outstanding.
As a result of the redemptions,
Abri now has less liquidity and fewer round-lot holders of its public shares, which may make it more difficult to meet Nasdaq listing
requirements. Since it is a condition to closing to receive the approval for listing by Nasdaq of the shares of Abri’s Common Stock
to be issued in connection with the transactions contemplated by the Merger Agreement, Abri’s reduced public float may make it
more difficult for it to meet one of the Nasdaq listing requirements, and to consummate the Business Combination.
As a result of the redemptions,
Abri now has less liquidity and fewer round-lot holders of its public shares, which may make it more difficult to meet Nasdaq listing
requirements.
The Units, Common Stock and
Warrants are currently listed on the Nasdaq Stock Market, under the symbols “ASPAU,” “ASPA,” and “ASPAW,”
respectively. The Units, Common Stock and Warrants commenced trading on the Nasdaq Stock Market separately on September 3, 2021.
A listing application has
been filed with Nasdaq to list the Combined Company’s shares of Common Stock and Warrants on Nasdaq Global Market under the symbol
“CAUD” and “CAUDW”. Although it is believed that the Combined Company will meet the initial listing requirements
for the Nasdaq Global Market, and such listing is a condition to consummating the Business Combination, we cannot assure you that the
shares of Common Stock and Warrants will be approved for listing on Nasdaq Global Market, in which case we would not be able to consummate
the Business Combination.
Abri’s principal executive
offices are located at 9663 Santa Monica Blvd., No. 1091, Beverly Hills, CA 90210, and its telephone number is (424) 732-1021.
Logiq, Inc’s principal executive offices
are located at 85 Broad Street 16-079, New York NY 1004 and its telephone number is (808) 829-1057.
Merger Sub
Merger Sub is a wholly-owned
subsidiary of Abri formed to consummate the Business Combination. Following Closing, Merger Sub will have merged with and into DLQ, with
DLQ surviving the Merger as a wholly-owned subsidiary of Abri.
DLQ, Inc.
Overview
DLQ, Inc. is a Nevada corporation
(“DLQ”), originally incorporated in 2019 as Origin8, Inc. On April 15, 2020, its name was changed to Logiq,
Inc. and on August 29, 2022 its name was changed to DLQ, Inc. DLQ is a wholly owned subsidiary of Logiq, Inc., a Delaware corporation
(“DLQ Parent”), whose common stock is quoted on the OTCQX Market under the ticker symbol, “LGIQ.”
DLQ has three wholly owned subsidiaries, (i) Tamble Inc., a Delaware corporation (“Tamble”), (ii) Push
Interactive, LLC, a Minnesota limited liability company (“Push”), and (iii) BattleBridge Acquisition Co.
LLC, a Nevada corporation (“BattleBridge”) DLQ is headquartered in Minneapolis, Minnesota, USA.
Acquisition History
In January 2020, DLQ
and DLQ Parent completed the acquisition of substantially all of the assets of Push Holdings, Inc., a Delaware corporation, including
all of the ownership interests in Tamble and Push, making them wholly-owned subsidiaries of DLQ. This business segment has been
rebranded as DataLogiq, which operates as a consumer data management platform powered by lead generation, online marketing, and multi-channel
reengagement strategies through its owned and operated brands. DataLogiq has developed this proprietary data management platform and
integrated it with several third-party service providers to optimize the return on its marketing efforts. DataLogiq focuses on consumer
engagement and enrichment to maximize its return on acquisition through repeat monetization of each consumer. DataLogiq also licenses
its software technology and provides managed technology services to various other e-commerce companies. DataLogiq operations are located
in Minneapolis, Minnesota, USA.
On November 3, 2020,
DLQ Parent completed the acquisition of Fixel AI Inc. (“Fixel”), which includes its self-serve MarTech Audience
Targeting platform as a further expansion of the DataLogiq product suite. In connection with the Business Combination, DLQ and Abri intended
for assets and IP of Fixel to be acquired by DLQ prior to Closing. After further review, however, DLQ has decided that it will not go
through with the acquisition as part of the Business Combination due to the complexities related to the IP transfer and the negligible
independent value of such assets.
On March 30, 2021, DLQ
Parent acquired Rebel AI, Inc., a Delaware corporation (“Rebel”) to enable small and medium-sized businesses
(“SMBs”) to more effectively compete against larger businesses for new customers at enterprise scale without
the cost. In connection with the Business Combination, DLQ and Abri intended for the assets and IP of Rebel to be acquired by DLQ prior
to Closing. After further analysis, however, based on the negligible independent value of the assets and minimal business prospects,
DLQ has decided that it will not go through with the acquisition as part of the Business Combination.
On March 31, 2022, BattleBridge,
a wholly-owned subsidiary of DLQ, acquired substantially all of the assets of Section 2383, LLC which represents the “BattleBridge
Labs” business (“BattleBridge Labs”) including customer lists and contracts, trade names and trademarks,
marketing resources, proprietary tech and processes, and more. This acquisition allows DLQ to provide full-service branding and digital
marketing agency services, serving both external clients and other DLQ business units.
A current organizational chart of DLQ, a subsidiary
of Logiq, Inc., before the acquisition is below:
This diagram shows the
ownership of DLQ Inc. before the Business Combination with DLQ Parent owning 100%.
In addition to DLQ, DLQ Parent
also has three other subsidiaries, (i) Rebel AI, Inc., (ii) Fixel AI, Inc., and (iii) Fixel Israel Ltd. (collectively the “Sister
Companies”). After Closing, the Sister Companies will remain subsidiaries of DLQ Parent and DLQ will not have any ownership
of the Sister Companies. Initially, DLQ was to acquire all of the intellectual property relating to Fixels’ Mar Fixel’s MarTech
Audience Targeting Platform and the Rebel SMB marketing platform from DLQ Parent prior to the Closing of the Business Combination. DLQ
has since concluded that due to the complexities related to the IP transfers and the negligible independent value of such assets, the
acquisition of these platforms no longer complement their business model and an amendment to the Merger Agreement to remove these acquisitions
as a condition to closing has been executed.
After Closing, DLQ Parent
Stockholders will hold a total of 11,400,000 shares of the Combined Company both directly and indirectly through DLQ Parent. 2,850,000
of such shares will be issued to DLQ Parent Stockholders as Dividend Shares and the 8,550,000 remaining shares will be held by DLQ Parent.
For more information on DLQ,
please see the sections titled “Information about DLQ” and “Management’s Discussion and Analysis of
Financial Condition and Results of Operations of DLQ.”
Merger Agreement
On September 9, 2022, Abri
SPAC I, Inc., a Delaware corporation (“Abri”), entered into a Merger Agreement (the “Merger Agreement”)
by and among Abri Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of Abri (“Merger Sub”),
Logiq, Inc., a Delaware corporation (“DLQ Parent”) whose common stock is quoted on the OTCQX Market under the
ticker symbol, “LGIQ”, and DLQ, Inc., a Nevada corporation (“DLQ”) and wholly owned subsidiary
of DLQ Parent. Pursuant to the terms of the Merger Agreement, a business combination between Abri and DLQ will be effected through the
merger of Merger Sub with and into DLQ, with DLQ surviving the merger as a wholly owned subsidiary of Abri (the “Merger”).
The board of directors of Abri has (i) approved and declared advisable the Merger Agreement, the Additional Agreements (as defined in
the Merger Agreement) and the transactions contemplated thereby and (ii) resolved to recommend approval of the Merger Agreement and related
transactions by the stockholders of Abri. The Merger is expected to be consummated after obtaining the required approval by the stockholders
of Abri, DLQ and DLQ Parent and the satisfaction of certain other customary closing conditions.
On May 1, 2023 Abri, Abri
Sub, DLQ Parent, and DLQ entered into an amendment to the Merger Agreement (the “First Merger Agreement Amendment”)
removing the closing condition requiring Abri to have net tangible assets in excess of $5,000,001 either immediately prior to or upon
consummation of the Merger.
On June 8, 2023 Abri, Abri
Sub, DLQ Parent, and DLQ entered into an amendment to the Merger Agreement (the “Second Merger Agreement Amendment”)
to (i) amend the exchange on which its securities can be listed in connection with the Business Combination to include being listed on
Nasdaq Global Market, and (ii) waive any default of Section 9.1(i) of the Merger Agreement for having received the MVLS Notice from Nasdaq.
On July 20, 2023 Abri, Abri
Sub, DLQ Parent, and DLQ entered into an amendment to the Merger Agreement (the “Third Merger Agreement Amendment”)
to (i) remove provisions related to the transfer of certain intellectual property assets of Fixel AI, Inc. (“Fixel AI”)
and Rebel AI, Inc. (“Rebel”) which were deemed to have negligible independent value (ii) change the name of
the Surviving Corporation to “Collective Audience, Inc.” and (iii) increase the size of the senior financing facility from
$25 million to $30 million.
On August 28, 2023, Abri,
Abri Sub, DLQ Parent, and DLQ entered into an amendment to the Merger Agreement (the “Fourth Merger Agreement Amendment”)
to (i) increase the number of Dividend Shares to be issued to DLQ Parent stockholders at the Closing of the Business Combination from
25% of the Merger Consideration Shares to 33% of the Merger Consideration Shares, (ii) distribute 14% of the aggregate Merger Consideration
Shares to certain DLQ investors, and (iii) to ensure 53% of the Merger Consideration Shares will be subject to lock-up.
The Merger is expected to
be consummated after obtaining the required approval by the stockholders of Abri, DLQ and DLQ Parent and the satisfaction of certain
other customary closing conditions.
The above diagram takes
into account three scenarios based on (i) no additional redemptions, (ii) an interim scenario where 626,186 public shares or 50% of the
remaining public shares are redeemed, and (iii) all remaining public shares are redeemed. The percentages are reflected by the corresponding
scenario.
It
is anticipated that, upon the consummation of the Business Combination, based on (i) no additional redemptions, (ii) an interim scenario
where 50% of the remaining public shares are redeemed, or 341,074 shares, and (iii) all remaining public shares are redeemed, Abri public
stockholders will retain an ownership interest of approximately 4.9%, 2.5% and 0%, respectively, in the Combined Company; the Sponsor
and directors of Abri will retain an ownership interest of approximately 12.5%, 12.8% and 13.1%, respectively, in the Combined Company,
the Representative will retain an ownership interest of approximately 0.2%, 0.2% and 0.2%, respectively in the Combined Company, DLQ
Parent will own approximately 43.6%, 44.7% and 45.9%, respectively of the outstanding Common Stock of the Combined Company and the DLQ
Parent Stockholders will own approximately 27.2%, 27.9% and 28.6%, respectively of the outstanding Common Stock of the Combined Company
and the DLQ Investors will own approximately 11.6%, 11.9% and 12.2%, respectively of the outstanding Common Stock of the Combined
Company..
The ownership percentages
set forth above with respect to the Combined Company do not take into account the redemption of any shares of Common Stock by the public
stockholders, nor the distribution of any Management Earnout Shares or Sponsor Earnout Shares. If the actual facts are different from
these assumptions (which they are likely to be), the percentage ownership retained by the Abri stockholders will be different. See “Unaudited
Pro Forma Condensed Combined Financial Information.”
Merger Consideration
The total consideration to
be paid at Closing (the “Merger Consideration”) by Abri to DLQ security holders will be an amount equal to
$114 million. The Merger Consideration will be payable in 11,400,000 shares of common stock, par value $0.0001 per share, of Abri (“Abri
Common Stock”).
Treatment of DLQ Securities
Cancellation of Securities
Each share of DLQ Common
Stock (defined below), if any, that is owned by Abri, Merger Sub, DLQ, or any other affiliate of Abri (as treasury stock or otherwise)
immediately prior to the effective time of the Merger (the “Effective Time”), will automatically be cancelled
and retired without any conversion or consideration.
| ● | “DLQ Common Stock” means at the Effective
Time, each issued and outstanding share of DLQ’s common stock, par value $0.0001 per share (other than any such shares of DLQ common
stock cancelled as described above), which will be converted into the right to receive a number of shares of Abri Common Stock equal
to the Conversion Ratio. |
| ● | “Conversion Ratio” means the quotient obtained
by dividing (a) the Per Share Merger Consideration by (b) $10.00. |
| ● | “Per Share Merger Consideration” means an
amount equal to $114,000,000, divided by the number of Fully Diluted Company Shares. |
| ● | “Fully Diluted Company Shares” means the sum,
without duplication, of (a) all shares of DLQ Common Stock that are issued and outstanding immediately prior to the Effective Time plus
(b) all shares of DLQ Common Stock issuable upon conversion, exercise or exchange of any other in-the-money securities of DLQ convertible
into or exchangeable or exercisable for shares of DLQ Common Stock; |
| ● | “Merger Consideration Shares” means an aggregate
number of shares of Abri Common Stock equal to the product of (i) the Conversion Ratio, multiplied by (ii) Fully-Diluted Company Shares. |
| ● | “Dividend Shares” means the number of Merger
Consideration Shares that DLQ Parent will issue as a dividend to the DLQ Parent Stockholders concurrent with Closing (the “Distribution”),
on a pro rata basis in an amount equal to approximately thirty three percent (33%) of the aggregate Merger Consideration Shares (the
“Dividend Shares”). The remaining Merger Consideration Shares held by DLQ Parent will be subject to a lock-up
in accordance with the terms and conditions more fully set forth in the Lock-Up Agreement, as described herein. |
Merger Sub Securities
Each share of common stock,
par value $0.0001 per share, of Merger Sub issued and outstanding immediately prior to the Effective Time will be converted into and
become one newly issued share of common stock of the surviving corporation of the Merger.
Representations and Warranties
The Merger Agreement contains
customary representations and warranties of the parties thereto with respect to, among other things: (a) corporate existence and power;
(b) authorization to enter into the Merger Agreement and related transactions; (c) governmental authorization; (d) non-contravention;
(e) capitalization; (f) corporate records; (g) subsidiaries; (h) consents; (i) financial statements; (j) books and records; (k) internal
accounting controls; (l) absence of certain changes; (m) properties; title to assets; (n) litigation; (o) contracts; (p) licenses and
permits; (q) compliance with laws; (r) intellectual property; (s) accounts payable; affiliate loans; (t) employee matters and benefits;
(u) real property; (v) tax matters; (w) environmental laws; (x) finders’ fees; (y) powers of attorney, suretyships and bank accounts;
(z) directors and officers; (aa) anti-money laundering laws; (ab) insurance; (ac) related party transactions; and (ad) certain representations
related to securities law and activity. Abri has additional representations and warranties, including (a) issuance of shares; (b) trust
fund; (c) listing; (d) board approval; (e) SEC documents and financial statements; (f) certain business practices; and (g) expenses,
indebtedness and other liabilities.
Covenants
The Merger Agreement includes
customary covenants of the parties with respect to operation of their respective businesses prior to consummation of the Merger and efforts
to satisfy conditions to consummation of the Merger. The Merger Agreement also contains additional covenants of the parties, including,
among others, conduct of business, access to information, notice of certain events, cooperation in the preparation of the Form S-4 and
Proxy statement (as each such term is defined in the Merger Agreement) required to be filed in connection with the Merger and to obtain
all requisite approvals of each party’s respective stockholders. The Merger Agreement also contains additional covenants pertaining
to DLQ and DLQ Parent including reporting; compliance with laws; no insider trading, commercially reasonable efforts to obtain consents,
DLQ Stockholder and DLQ Parent Stockholder approval, provide additional financial information, execute Lock-Up Agreements, amend parent
charter, issue dividend shares to DLQ Parent Stockholders, transfer certain assets as described in the Merger Agreement, not issue any
dividends or extraordinary bonuses until 11 months after closing, execute certain employment agreements and take reasonable efforts to
enter into a financing source agreement of up to $25 million after the Business Combination. Abri has also agreed to include in the Proxy
statement the recommendation of its board that its stockholders approve all of the proposals to be presented at the special meeting.
Non-Solicitation Restrictions
DLQ Parent and DLQ have each
agreed that from the date of the Merger Agreement until the Closing Date or, if earlier, the valid termination of the Merger Agreement
in accordance with its terms, it will not initiate, encourage or engage in any negotiations with any party relating to an Alternative
Transaction (as defined in the Merger Agreement), take any action intended to facilitate an Alternative Transaction or approve, recommend
or enter into any agreement relating to an Alternative Transaction.
Conditions to Closing
The
consummation of the Merger is conditioned upon, among other things, (i) the absence of any applicable (A) law or order, or (B) Action
(as defined in the Merger Agreement) commenced or asserted in writing by any Authority (as defined in the Merger Agreement), prohibiting
or, in the case of clause (B), materially restrict the consummation of the Merger and related transactions; (ii) receipt of any consent,
approval or authorization required by any Authority (as defined in the Merger Agreement); (iii) approval by DLQ Parent’s and DLQ’s
stockholders of the Merger and related transactions; (iv) approval by Abri’s stockholders of the Merger and related transactions;
(v) the Distribution of the Dividend Shares (as such term is defined in the Merger Agreement) shall be, in all respects, ready to be
consummated contemporaneously with the Merger; (vi) the conditional approval for listing by the Nasdaq Stock Market of the shares of
Abri Common Stock to be issued in connection with the transactions contemplated by the Merger Agreement and the Additional Agreements
and satisfaction of initial and continued listing requirements; and (vii) the Form S-4 becoming effective in accordance with the provisions
of the Securities Act of 1933, as amended (“Securities Act”). The condition for DLQ Parent to transfer all
of the Intellectual Property assets of Rebel AI, Inc. and all of the Intellectual Property assets of Fixel AI, Inc. to DLQ (each a”
Sister Company”) has been removed and, due to the negligible independent value of such assets, the Company
has not recognized any impairment as such amount would be immaterial. Furthermore, the value of these assets were not contemplated in
the merger valuation of DLQ.
Solely with respect to Abri
and Merger Sub, the consummation of the Merger is conditioned upon, among other things: (i) DLQ having duly performed or complied with
all of its obligations under the Merger Agreement in all material respects; (ii) the representations and warranties of DLQ, being true
and correct in all material respects; (iii) no event having occurred that would result in a Material Adverse Effect on DLQ or any of
its subsidiaries; (iv) providing a certificate from the chief executive officer as to the accuracy of these conditions; (v) shall have
obtained certain Company Group Consents (as such term is defined in the Merger Agreement); (vi) DLQ shall have filed all income Tax Returns
for the 2019, 2020 and 2021 tax years and paid all taxes with respect to such tax years (including penalties and interest, if any).
Solely with respect to DLQ,
the consummation of the Merger is conditioned upon, among other things: (i) Abri and Merger Sub having duly performed or complied with
all of their respective obligations under the Merger Agreement in all material respects; (ii) the representations and warranties of Abri
as set forth in the Merger Agreement that are qualified as to materiality being true in all respects and the representations and warranties
as set forth in the Merger Agreement that are not so qualified, being true and correct in all material respects; (iii); no event having
occurred that would result in a Material Adverse Effect on Abri or Merger Sub; (iv) Abri, Abri Ventures I, LLC (the “Sponsor”),
and any other security holder of Abri, shall have executed and delivered to DLQ each Additional Agreement to which they each are a party;
(v) Abri and Merger Sub having each delivered certain certificates to DLQ; (vi) Abri having filed its Amended Parent Charter (as defined
in the Merger Agreement) and such Amended Parent Charter being declared effective by, the Delaware Secretary of State; (vii) Abri having
delivered executed resignation of the Abri directors and officers as set forth in the Merger Agreement; (viii) after the redemption by
all stockholders of Abri who have elected to redeem their shares of Abri, Abri shall have made all necessary and appropriate arrangements
with the Trustee to have all of the remaining funds contained in the Trust Account, and all such funds released from the Trust Account
shall be available to Abri.
Termination
The Merger Agreement may
be terminated as follows:
(i) by either Abri or DLQ,
without liability to the other party, if (A) the Merger and related transactions are not consummated on or before February 12, 2023 (the
“Outside Closing Date”), and (B) the material breach or violation of any representation, warranty, covenant
or obligation under the Merger Agreement by the party seeking to terminate the Merger Agreement was not the cause of, or resulted in,
the failure of the Closing to occur on or before the Outside Closing Date. Such right may be exercised by Abri or DLQ, as the case may
be, giving written notice to the other at any time after the Outside Closing Date;
(ii) by either Abri or DLQ
if any Authority (as defined in the Merger Agreement) has issued any final decree, order, judgment, award, injunction, rule or consent
or enacted any law, having the effect of permanently enjoining or prohibiting the consummation of the Merger;
(iii) by Abri in the event
that DLQ does not deliver to Abri the Company Group Financial Statements on or prior to October 15, 2022, as defined in the Merger Agreement;
(iv) by mutual written consent
of Abri and DLQ duly authorized by each of their respective boards of directors;
(v) by Abri in the event
that the Board of Directors of Abri, in exercising its fiduciary duties, determines that the Business Combination is no longer in the
best interests of the stockholders of Abri;
(vi) by Abri or DLQ if, at
the Abri Stockholder Meeting (including any postponements or adjournments thereof), the Required Parent Proposals (as described in the
Merger Agreement) shall fail to be approved by the affirmative vote of Abri stockholders required under Abri’s organizational documents
and applicable Law or if, at the DLQ Parent Stockholder Meeting (including any postponements or adjournments thereof), the DLQ Parent
Stockholder Approval shall fail to be approved by the affirmative vote of DLQ Parent stockholders required under DLQ Parent’s organizational
documents and applicable Law.
(vii) by either Abri or DLQ,
if the other party has breached any of its covenants or representations and warranties such that it would be impossible or would reasonably
be expected to be impossible to satisfy any of its closing conditions and such breach is incapable of being cured or is not cured by
the earlier of (A) the Outside Closing Date and (B) 30 days following receipt by the breaching party of a written notice of the breach
or suffered a Material Adverse Effect which is incurable and continuing; provided that the terminating party is not then in breach of
the Merger Agreement so as to prevent the satisfaction of its closing conditions.
Effect of Termination
If the Merger Agreement is
terminated in accordance with its terms, the Merger Agreement will become void and of no further force and effect without liability of
any party, except for liability arising out of any party’s willful breach of the Merger Agreement or intentional fraud.
Certain Related Agreements
This section describes
certain additional agreements entered into or to be entered into pursuant to the Merger Agreement, but does not purport to describe all
of the terms thereof. The following summary is qualified in its entirety by reference to the complete text of each of the agreements.
The full text of the related agreements, or forms thereof, are filed as annexes to this proxy statement or as exhibits to the registration
statement of which this proxy statemen forms a part, and the following descriptions are qualified in their entirety by the full text
of such annexes and exhibits. Shareholders and other interested parties are urged to read such related agreements in their entirety prior
to voting on the proposals presented at the special meeting.
Parent Stockholder Support Agreement
In connection with the execution
of the Merger Agreement, Abri, and the Sponsor entered into that certain Parent Stockholder Support Agreement dated September 9, 2022
(the “Parent Stockholder Support Agreement”) pursuant to which the Sponsor agreed to vote all shares of Abri
Common Stock beneficially owned by them in favor of the Parent Proposals (as defined in the Merger Agreement), including the Merger and
related transactions and against any action reasonably expected to impede, delay or materially and adversely affect the Merger and related
transactions. The Sponsor agrees to comply with the new Compliance and Disclosure Interpretations of the SEC Tender Offer Rules including
Section 166 — Rule 14e-5, and to date has not purchased nor intends to purchase any additional shares of Common Stock of the Company.
Agreements to be Executed at Closing
DLQ Management Earnout Agreement
In connection with the execution
of the Merger Agreement, Abri and the Sponsor will enter into a management earnout agreement (the “Management Earnout Agreement”),
pursuant to which certain members of the management team of DLQ specified on schedule A to the Management Earnout Agreement (the “Management”)
will have the contingent right to earn the Management Earnout Shares (as defined in the Management Earnout Agreement). The Management
Earnout Shares consist of 2,000,000 shares of Abri Common Stock (the “Management Earnout Shares”). The release
of the Management Earnout Shares shall occur as follows:
| ● | 500,000 Management Earnout Shares will be earned and released
upon satisfaction of the First Milestone Event (as defined in the Management Earnout Agreement); |
| ● | 650,000 Management Earnout Shares will be earned and released
upon satisfaction of the Second Milestone Event (as defined in the Management Earnout Agreement); and |
| ● | 850,000 Management Earnout Shares will be earned and released
upon satisfaction of the Third Milestone Event (as defined in the Management Earnout Agreement). |
Sponsor Earnout Agreement
In connection with the execution
of the Merger Agreement, Abri and the Sponsor will enter into a sponsor earnout agreement (the “Sponsor Earnout Agreement”),
pursuant to which the Sponsor will have the contingent right to earn the Sponsor Earnout Shares (as defined in the Sponsor Earnout Agreement).
The Sponsor Earnout Shares consist of 1,000,000 shares of Abri Common Stock (the “Sponsor Earnout Shares”).
The release of the Sponsor Earnout Shares shall occur as follows:
| ● | 250,000 Sponsor Earnout Shares will be earned and released upon
satisfaction of the First Milestone Event (as defined in the Sponsor Earnout Agreement); |
| ● | 350,000 Sponsor Earnout Shares will be earned and released upon
satisfaction of the Second Milestone Event (as defined in the Sponsor Earnout Agreement); and |
| ● | 400,000 Sponsor Earnout Shares will be earned and released upon
satisfaction of the Third Milestone Event (as defined in the Sponsor Earnout Agreement). |
Lock-Up Agreement
In connection with the execution
of the Merger Agreement, Abri, and DLQ Parent will enter into a lock-up agreement (the “Lock-Up Agreement”),
pursuant to which each DLQ Parent will agree, subject to certain customary exceptions, not to (i) sell, offer to sell, contract
or agree to sell, pledge or otherwise dispose of, directly or indirectly, seventy five percent (75%) of the shares of Abri Common Stock
held by them as part of the Merger Consideration, which shares do not include the Dividend Shares, (such shares, together with any securities
convertible into or exchangeable for or representing the rights to receive shares of Common Stock if any, acquired during the Lock-Up
Period (as defined below), the “Lock-Up Shares”), (ii) enter into a transaction that would have the same
effect, (iii) enter into any swap, hedge or other arrangement that transfers to another, in whole or in part, any of the economic
consequences of ownership of the Lock-Up Shares or otherwise, or engage in any short sales or other arrangement with respect to the Lock-Up
Shares or (iv) publicly announce any intention to effect any transaction specified in clause (i) or (ii) until the date
that is 11 months after the Closing Date (the period from the date of the Lock-Up Agreement until such date, the “Lock-Up
Period”). DLQ will also cause certain members of its management to enter into a Lock-up Agreement concerning shares of
Abri Common Stock they will own.
Amended and Restated Registration Rights
Agreement
At Closing, Abri, the Sponsor,
and Chardan Capital Markets, LLC as underwriter (the “Underwriter”) will enter into an amended and restated
registration rights agreement (the “Amended and Restated Registration Rights Agreement”), pursuant to which
the Sponsor, the Underwriter and holders of the Lock-Up Shares and recipients of the Management Earnout Shares and Sponsor Earnout Shares,
if any, will be provided certain rights relating to the registration of certain Abri securities.
Voting Agreement
In connection with the execution
of the Merger Agreement, Abri, the Sponsor and certain holders of Abri Common Stock (as identified in the Voting Agreement) will enter
into a voting agreement (the “Voting Agreement”), pursuant to which such holders of Abri Common Stock agree
to vote in favor of certain matters relating to the nomination and election of the Post-Closing Board of Directors (as described in the
Voting Agreement).
Warrant Revenue Sharing Side Letter
In connection with the execution
of the Merger Agreement, Abri, DLQ and the Sponsor will enter into a letter agreement (the “Warrant Revenue Sharing Side
Letter”), pursuant to which Abri and DLQ will divide the proceeds from the Warrant Exercise Price (as defined in the Warrant
Revenue Sharing Side Letter), arising from the exercise of the warrants issued as part of the Abri Units sold in its initial public
offering whereby twenty percent (20%) of the Warrant Exercise Price received in cash by Abri shall be delivered to the Sponsor in cash
or immediately available funds not later than three (3) days following Abri’s receipt of the cash exercise price of any Warrant.
Management
Effective as of the Closing,
the Combined Company’s board of directors will have five (5) directors, of which three (3) directors will be designated by Sponsor,
and the remaining two (2) directors will be designated by DLQ; one (1) of which is an existing director of DLQ. At the Closing, all of
the executive officers of Abri shall resign and the individuals serving as executive officers of the Combined Company immediately after
the Closing will be Brent Suen as Chief Executive Officer, Chris Andrews as Chief Operating Officer, and Robb Billy as Chief Financial
Officer. The directors will be Brent Suen, Christopher Hardt, Nadine Watt, Elisabeth DeMarse and Denis Duncan if Proposal 5 is approved
by the Abri stockholders. Nadine Watt, Elisabeth DeMarse and Denis Duncan will be the independent directors.
See “Directors, Executive
Officers, Executive Compensation and Corporate Governance — Directors and Executive Officers after the Business Combination”
for additional information.
Voting Securities
As of the Record Date, there were
105,284,314 shares of Common Stock issued and outstanding. Only Logiq stockholders who hold shares of Common Stock of record as of the
close of business on September 25, 2023 are entitled to vote at the Meeting or any adjournment thereof. Approval of the Business Combination
Proposal, and the Adjournment Proposal will each require the affirmative vote of the holders of a majority of the issued and outstanding
shares of Common Stock present in person by virtual attendance or represented by proxy and entitled to vote at the Meeting or any adjournment
thereof. The vote to approve the Business Combination Proposal is a majority of the votes cast at a meeting at which a quorum is present.
Attending the Meeting either
in person by virtual attendance or by submitting your proxy and abstaining from voting will have the same effect as voting against all
the Proposals.
With respect to Abri’s
approval of the Business Combination, pursuant to the Letter Agreement and the Support Agreement, the Abri Initial Stockholders holding
an aggregate of 1,728,078 shares (or 72% of the Abri outstanding shares) of Abri Common Stock have agreed to vote their respective shares
of Abri Common Stock in favor of each of the Proposals set forth in the Abri Shareholder meeting. As a result, no shares of Abri Common
Stock held by the public stockholders will need to be present in person by virtual attendance or by proxy to satisfy the quorum requirement
for the Abri meeting. The vote to approve the Business Combination Proposal is a majority of the votes cast at a meeting at which a quorum
is present. Since only the minimum number of shares of Abri Common Stock to constitute a quorum need be present, and the Sponsor owns
1,728,078 shares of Common Stock, or approximately 72% of the outstanding shares of the Abri Common Stock, no Abri public stockholders
need to vote in favor of the Business Combination Proposal for it to be approved.
Appraisal Rights
Appraisal rights are not available
to holders of shares of Common Stock in connection with the proposed Business Combination under Delaware law.
Abri Redemption Rights
Pursuant to Abri’s Certificate
of Incorporation, holders of shares of Abri Common Stock may elect to have their shares redeemed for cash at the applicable redemption
price per share equal to the quotient obtained by dividing (i) the aggregate amount on deposit in the Trust Account as of two business days
prior to Closing, including interest (net of taxes payable), by (ii) the total number of then-outstanding shares of Abri Common Stock.
As of September 25, 2023, this would have amounted to approximately $10.68 per share.
Abri stockholders will be
entitled to receive cash for any shares of Common Stock to be redeemed only if they:
| (i) | (a) |
hold shares of Abri Common Stock,
or |
| (b) | hold shares of Abri Common Stock through Units and elect
to separate their Units into the underlying shares of Abri Common Stock prior to exercising their redemption rights with respect
to the shares of Abri Common Stock; and |
| (ii) | prior to 5:00pm, Eastern Time, on October 19, 2023, (a) submit
a written request to Continental that Abri redeem their shares of Abri Common Stock for cash and (b) deliver the shares of Abri
Common Stock to Continental, physically or electronically through DTC. |
Holders of outstanding Units must
separate the underlying shares of Abri Common Stock prior to exercising redemption rights with respect to the shares of Abri Common Stock.
If the Units are registered in a holder’s own name, the holder must deliver the certificate for its Units to Continental,
with written instructions to separate the Units into their individual component parts. This must be completed far enough in advance
to permit the mailing of the certificates back to the holder so that the holder may then exercise his, her or its redemption rights upon
the separation of the shares of Abri Common Stock from the Units.
If a holder exercises his/her
redemption rights, then such holder will be exchanging his/her shares of Abri Common Stock for cash and will not own shares of the Combined
Company. Such a holder will be entitled to receive cash for its shares of Common Stock only if it properly demands redemption and delivers
its shares of Common Stock (either physically or electronically) to Continental in accordance with the procedures described herein. Please
see the section titled “The Meeting — Redemption Rights” for the procedures to be followed if you
wish to redeem your shares of Common Stock for cash.
Ownership of the Combined Company After the
Closing
It is anticipated that, upon
Closing, Abri public stockholders will retain an ownership interest of approximately 4.9% in the Combined Company, the Sponsor and directors
of Abri will retain an ownership interest of approximately 12.5% in the Combined Company, the Representative will retain an ownership
interest of approximately 0.2% in the Combined Company, DLQ Parent will own approximately 43.6% of the outstanding Common Stock of the
Combined Company, and DLQ Parent Stockholders will own approximately 27.2% of the Combined Company.
The ownership percentages
set forth above with respect to the Combined Company do not take into account the redemption of any additional shares of Common Stock
by the public stockholders. If the actual facts are different from these assumptions (which they are likely to be), the percentage ownership
retained by the Abri stockholders will be different. See “Unaudited Pro Forma Condensed Combined Financial Information.”
The following diagram summarizes
the pro forma ownership of Common Stock upon Closing of the Business Combination, including Common Stock underlying Units, and shares
of Common Stock following the Business Combination under (i) a no additional redemption scenario, (ii) an interim redemption scenario,
assuming fifty percent (50%) redemption of remaining shares, and (iii) a maximum redemption scenario:
| | |
No
Additional
Redemption
Scenario(1) | | |
Interim
Redemption
Scenario(2) | | |
Maximum
Redemption
Scenario(3) | |
| Equity Capitalization Summary | |
# of Shares | | |
% | | |
# of Shares | | |
% | | |
# of Shares | | |
% | |
| DLQ Parent | |
| 6,038,000 | | |
| 43.6 | % | |
| 6,038,000 | | |
| 44.7 | % | |
| 6,038,000 | | |
| 45.9 | % |
| DLQ Parent Stockholders | |
| 3,762,000 | | |
| 27.2 | % | |
| 3,762,000 | | |
| 27.9 | % | |
| 3,762,000 | | |
| 28.6 | % |
| DLQ Investors | |
| 1,600,000 | | |
| 11.6 | % | |
| 1,600,000 | | |
| 11.9 | % | |
| 1,600,000 | | |
| 12.2 | % |
| Total DLQ Equity Holders | |
| 11,400,000 | | |
| 82.4 | % | |
| 11,400,000 | | |
| 84.4 | % | |
| 11,400,000 | | |
| 86.7 | % |
| Abri Initial Public Stockholders | |
| 682,148 | | |
| 4.9 | % | |
| 341,074 | | |
| 2.5 | % | |
| — | | |
| —% | |
| Abri Initial Stockholders | |
| 1,728,078 | | |
| 12.5 | % | |
| 1,728,078 | | |
| 12.8 | % | |
| 1,728,078 | | |
| 13.1 | % |
| Representative Shares | |
| 30,000 | | |
| 0.2 | % | |
| 30,000 | | |
| 0.2 | % | |
| 30,000 | | |
| 0.2 | % |
| Total Common Stock* | |
| 13,840,226 | | |
| 100.0 | % | |
| 13,499,152 | | |
| 100.0 | % | |
| 13,158,078 | | |
| 100.0 | % |
| (1) | Under the no redemption scenario, it assumed no shares of Abri
Common Stock are redeemed. |
| (2) | Under the interim redemption scenario, it assumes redemptions
of fifty percent (50%) of the remaining shares of Common Stock are redeemed, amounting to 341,074 shares of Abri Common Stock for aggregate
redemption payments of $3.4 million using a per-share redemption price of $10.00. |
| (3) | Under the maximum redemption scenario, it assumes redemptions
of the remaining shares of Abri Common Stock, amounting to 682,148 shares of Common Stock, for aggregate redemption payments of $6.8
million using a per-share redemption price of $10.00. |
The diagram below reflects the ownership of the
Combined Company at the closing of the Business Combination:
The above diagram does
not give effect to distribution of any Earnout Shares or exercise of the Warrants, and takes into account three scenarios based on (i)
no additional redemptions, (ii) an interim scenario where 341,074 public shares or 50% of the remaining public shares are redeemed, and
(iii) maximum redemption where all remaining public shares are redeemed. The percentages are reflected by the corresponding scenario.
DLQ Investment
On September 5, 2023 DLQ entered
into an agreement with certain institutional investors (the “Investors”) for a $5 million investment in DLQ
(the “DLQ Investment”) in the form of convertible promissory notes issued by DLQ (the “DLQ Notes”).
The DLQ Notes shall convert into such number of shares of common stock of DLQ (the “Conversion Shares”), that
would be exchanged for 1,600,000 Merger Consideration Shares at the Closing. Certain non-affiliated stockholders of DLQ will separately
escrow 1,500,000 Merger Consideration Shares which may be issued to the Investors to cover any reset in the amount of Merger Consideration
Shares to cover the DLQ Investment amount until the DLQ Investment has been recouped by the Investors. In addition, the Management Shares
shall be placed in an escrow account until DLQ Investment amount until the DLQ Investment has been recouped by the Investors.
The DLQ Investment funds have
been put into an escrow account and shall be released at Closing to pay certain fees and expenses in connection with the Business Combination,
including closing costs including the deferred underwriter’s fee and for working capital. To the extent not utilized to consummate
the Business Combination, the remaining proceeds from the DLQ Investment and the proceeds from the Trust Account after redemptions will
be used for general corporate purposes, including, but not limited to, working capital for operations, capital expenditures and future
acquisitions. Investors have also received a $5 million convertible note issued by DLQ Parent (the “LGIQ Note”),
which shall, at the option of the Investors, convert into such number of shares of Common Stock of DLQ Parent (“LGIQ Shares”)
derived by dividing $5 million by the volume weighted average share price of LGIQ on the date before such conversion.
Potential Impact of Additional Dilution
It
is anticipated that, upon consummation of the Business Combination, after giving effect to the Merger Consideration including the Earnout
Consideration, as described herein, the exercise of outstanding Public Warrants and Private Warrants, and assuming (i) no additional
redemption of shares by the Abri public stockholders (ii) interim redemption of shares by the public stockholders, and (iii) maximum
redemption of shares by the public stockholders, the existing Abri public stockholders will own approximately 3.0%, 1.5% and 0%, respectively,
of the issued Combined Company’s shares of Common Stock, the Sponsor and its affiliates will own 7.6%, 7.7% and 7.8%, respectively
of the issued Combined Company’s shares of Common Stock, the Representative (as defined below) will own 0.1%, 0.1% and 0.1%, respectively
of the issued Combined Company’s shares of Common Stock, and DLQ Parent will own 24.6%, 26.8% and 27.2%, respectively, of the issued
Combined Company’s shares of Common Stock, DLQ Parent Stockholders will own 16.4%, 16.7% and 17.0%, respectively, of the issued
Combined Company’s shares of Common Stock, and DLQ Management will own 7.0%, 7.1% and 7.2%, respectively, of the issued Combined
Company’s shares of Common Stock and DLQ Management will own 8.7%, 8.9% and 9.0%, respectively, of the issued Combined Company’s
shares of Common Stock.
| | |
No Additional Redemption Scenario | | |
Interim Redemption Scenario | | |
Maximum Redemption Scenario | |
| Including Additional Dilution Sources | |
# of Shares | | |
% | | |
# of Shares | | |
% | | |
# of Shares | | |
% | |
| DLQ Parent(1) | |
| 6,038,000 | | |
| 26.4 | % | |
| 6,038,000 | | |
| 26.8 | % | |
| 6,038,000 | | |
| 27.2 | % |
| DLQ Parent Stockholders(1) | |
| 3,762,000 | | |
| 16.4 | % | |
| 3,762,000 | | |
| 16.7 | % | |
| 3,762,000 | | |
| 17.0 | % |
| DLQ Investors(1) | |
| 1,600,000 | | |
| 7.0 | % | |
| 1,600,000 | | |
| 7.1 | % | |
| 1,600,000 | | |
| 7.2 | % |
| Total DLQ Stockholders(1) | |
| 11,400,000 | | |
| 49.8 | % | |
| 11,400,000 | | |
| 50.5 | % | |
| 11,400,000 | | |
| 51.3 | % |
| DLQ Management Earnout Shares(2)(9) | |
| 2,000,000 | | |
| 8.7 | % | |
| 2,000,000 | | |
| 8.9 | % | |
| 2,000,000 | | |
| 9.0 | % |
| Abri Initial Public Stockholders | |
| 682,148 | | |
| 3.0 | % | |
| 341,074 | | |
| 1.5 | % | |
| — | | |
| — | % |
| Shares Underlying the Abri Public Warrants(3)(4) | |
| 5,733,920 | | |
| 25.0 | % | |
| 5,733,920 | | |
| 25.5 | % | |
| 5,733,920 | | |
| 25.9 | % |
| Abri Initial Stockholders | |
| 1,728,078 | | |
| 7.6 | % | |
| 1,728,078 | | |
| 7.7 | % | |
| 1,728,078 | | |
| 7.8 | % |
| Abri Sponsor Earnout Shares(5) | |
| 1,000,000 | | |
| 4.4 | % | |
| 1,000,000 | | |
| 4.4 | % | |
| 1,000,000 | | |
| 4.5 | % |
| Shares Underlying the Abri Sponsor Private Warrants(4) | |
| 89,272 | | |
| 0.4 | % | |
| 89,272 | | |
| 0.4 | % | |
| 89,272 | | |
| 0.4 | % |
| Representative Shares(6) | |
| 30,000 | | |
| 0.1 | % | |
| 30,000 | | |
| 0.1 | % | |
| 30,000 | | |
| 0.1 | % |
| Shares Underlying the UPO(6)(7) | |
| 104,253 | | |
| 0.5 | % | |
| 104,253 | | |
| 0.5 | % | |
| 104,253 | | |
| 0.5 | % |
| Shares Underlying the Warrants of the UPO(8) | |
| 104,253 | | |
| 0.5 | % | |
| 104,253 | | |
| 0.5 | % | |
| 104,253 | | |
| 0.5 | % |
| Total Including Additional Dilutive Sources | |
| 22,871,924 | | |
| 100.0 | % | |
| 22,530,850 | | |
| 100.0 | % | |
| 22,189,776 | | |
| 100.0 | % |
| (1) | Assumes
23,762,000 Dividend Shares are issued to DLQ Parent Stockholders and or 33%, and 1,600,000 shares issued to the DLQ Investors. |
| (2) | Assumes all 2,000,000 Management Earnout Shares are issued to
DLQ Management. |
| (3) | Assumes DLQ’s stock price above $11.50 and warrants are
exercised for $11.50 cash. The $65.9 million cash proceeds of warrant exercise are not included in the pro forma financials. |
| (4) | Assumes DLQ’s stock price at or above $16.50 and private
warrants are exercised (cashless) at $11.50. |
| (5) | Assumes all 1,000,000 Sponsor Earnout Shares are issued to Abri
Sponsor. |
| (6) | Assumes 30,000 shares are issued to Representative at Closing. |
| (7) | Assumes DLQ’s stock price at or above $16.50 and options
are exercised (cashless) at $11.50. |
| (8) | Assumes DLQ’s stock price at or above $16.50 and warrants
in the UPO are exercised (cashless) at $11.50. |
| (9) | Assumes Management Earnout Shares are issued as follows: 800,000
to Brent Suen, 600,000 to Chris Andrews, 100,000 to Lionel Choong and 500,000 to Chris Metcalf, which allocations are subject to change. |
Maximum Redemption Calculation
In the above table, the maximum
redemption scenario takes into account the maximum amount of shares for redemption at zero shares of Common Stock and the transaction
costs of $3,878,426 (which includes transaction expenses of $2,378,426, plus a deferred underwriting fee of $1,500,000) Abri believes
that even after redemptions in the Maximum Redemption Scenario, it will have sufficient funds to operate the Combined Company. With the
funds from the DLQ Investment the Combined Company will have approximately $1,745,241 million in cash after paying closing expenses of
$3,878,426, including the deferred underwriter’s fee in connection with the Business Combination. If the Combined Company needs
additional capital after the Closing, the Sponsor shall be the exclusive financing source of capital to fund the Combined Company after
the Business Combination for up to $30 million, which capital shall be sourced by the Sponsor through debt or equity financings based
upon acceptable market conditions available at that time, and upon agreement by the Company and the Sponsor.
Interim Redemption Calculation
In the above table, the interim
redemption scenario takes into account an interim redemption of fifty percent (50%) of the remaining shares of Common Stock available
for redemption and the transaction costs of $3,878,426 (which includes transaction expenses of $2,378,426, plus a deferred underwriting
fee of $1,500,000). In such case, this leaves 626,186 shares of Common Stock for an aggregate of $6.3 million (using a per-share redemption
price of $10.00).
Deferred Underwriting Fee Analysis
The deferred underwriting
fee is based on the Underwriting Agreement in connection with the IPO and is a fixed fee of $1,500,000, or 3.0% of the gross proceeds
of the IPO. This fee remains constant, however, as a percentage of remaining proceeds after redemptions, the percentage will change depending
on the amount of redemptions. For example, if there are no additional redemptions (No Additional Redemption Scenario), the deferred underwriting
fee as a percentage of remaining proceeds would be 22%; at a 50% redemption of the remaining public shares (Interim Redemption Scenario),
it would be 44%; and at a maximum redemption (Maximum Redemption Scenario), the fee would be not applicable as illustrated in the table
below:
| Underwriting Fees | |
No Additional
Redemption Scenario | | |
Interim
Redemption
Scenario(1) | | |
Maximum
Redemption
Scenario(2) | |
| Unredeemed Public Shares | |
| 682,148 | | |
| 341,074 | | |
| — | |
| Trust Proceeds to DLQ | |
$ | 7,243,869 | | |
$ | 3,621,935 | | |
$ | — | |
| Deferred Underwriting Fee | |
$ | 1,500,000 | | |
$ | 1,500,000 | | |
$ | 1,500,000 | |
| Effective Deferred Underwriting Fee | |
| 22.0 | % | |
| 44.0 | % | |
| N/A | |
| | |
| | | |
| | | |
| | |
| (1) | Under the interim redemption scenario, it assumes redemptions
of fifty percent (50%) of the remaining unredeemed public shares amounting to 341.074 shares of Common Stock for aggregate redemption
payments of $3.6 million using a per-share redemption price of $10.00 |
| (2) | Under the maximum redemption scenario, it assumes redemptions
of all remaining public shares of Common Stock for aggregate redemption payments of $12.5 million using a per-share redemption price
of $10.00. |
Pro Forma Net Loss and Net Loss Per Share
Calculation
The table below shows the
net loss and net loss per share of Common Stock as of June 30, 2023 and as of December 31, 2022 in each of the three redemption scenarios:
| Net Loss and Net Loss Per Share Calculation | |
No Additional
Redemption
Scenario | | |
Interim
Redemption
Scenario | | |
Max
Redemption
Scenario | |
| For the six months ended June 30, 2023: | |
| | |
| | |
| |
| Net Loss | |
$ | (3,640,056 | ) | |
| (3,640,056 | ) | |
| 3,640,056 | |
| Net Loss Per Share – basic | |
$ | (0.26 | ) | |
| (0.27 | ) | |
| (0.28 | ) |
| Net Loss Per Share – diluted | |
$ | (0.26 | ) | |
| (0.27 | ) | |
| (0.28 | ) |
| Weighted average shares o/s of common stock – basic | |
| 13,840,226 | | |
| 13,499,152 | | |
| 13,158,078 | |
| Weighted average shares o/s of common stock – diluted | |
| 13,840,226 | | |
| 13,499,152 | | |
| 13,158,078 | |
| | |
| | | |
| | | |
| | |
| For the year ended December 31, 2022: | |
| | | |
| | | |
| | |
| Net Loss | |
$ | (11,278,330 | ) | |
| (11,278,330 | ) | |
| (11,278,330 | ) |
| Net Loss Per Share – basic | |
$ | (0.81 | ) | |
| (0.84 | ) | |
| (0.86 | ) |
| Net Loss Per Share – diluted | |
$ | (0.81 | ) | |
| (0.84 | ) | |
| (0.86 | ) |
| Weighted average shares o/s of common stock – basic | |
| 13,840,226 | | |
| 13,499,152 | | |
| 13,158,078 | |
| Weighted average shares o/s of common stock – diluted | |
| 13,840,226 | | |
| 13,499,152 | | |
| 13,158,078 | |
Interests of Certain Persons in the Business
Combination
When you consider the recommendation
of the Board in favor of adoption of the Business Combination Proposal and other Proposals, you should keep in mind that Abri’s
directors and officers and DLQ’s directors and officers have interests in the Business Combination that are different from, or
in addition to, your interests as a stockholder, including:
| ● | At an
Extension Meeting of Abri’s stockholders held on December 9, 2022, Abri’s stockholders approved (i) a proposal to amend Abri’s
amended and restated certificate of incorporation, and (ii) a proposal to amend the Management Trust Agreement with the Transfer Agent,
to extend the date by which Abri has to consummate a business combination from February 12, 2023 until August 12, 2023, on an as needed,
month-to-month basis (each an “Extension”), by depositing an additional $87,500 (a “Contribution”)
into the Trust Account for each such one-month Extension (referred to as the “December 9 Amendments”)
the Sponsor made aggregate Contributions in the amount of $525,000 to extend the time to complete a business combination to August 12,
2023. |
| ● | If an initial business combination, such as the Business Combination,
is not completed by February 12, 2024, Abri will be required to dissolve and liquidate.. |
| ● | If the Business Combination is not approved, in accordance with Abri’s
Charter, the 1,433,480 founder shares held by its Sponsor, Abri’s officers and directors, which were acquired prior to the IPO for
an aggregate purchase price of $25,000, will be worthless (as the holders have waived liquidation rights with respect to such shares),
as will the 294,598 shares of Abri Common stock and 294,598 Private Warrants that were included in the Private Units acquired simultaneously
with the IPO and in connection with the exercise of the overallotment option, for an aggregate purchase price of $2,945,980. Irrespective
of existing lock-up agreements that impose restrictions on the transfer of the founder shares, the shares of Abri Common Stock in the
Private Units and Private Warrants, such founder shares together with the shares of Abri Common Stock in the Private Units, and Private
Warrants had an aggregate market value of approximately $3,249,416 based on the last sale price of $10.95 and $0.08, respectively, on
Nasdaq on September 25, 2023. See “Proposal No. 1 — The Business Combination Proposal — Interests
of Certain Persons in the Business Combination” for additional information. |
| ● | The Sponsor may receive up to $13,188,016 (or 20%) of the proceeds
of the exercise of the Public Warrants, if the Public Warrants are exercised at $11.50 per share. The Public Warrants may be redeemed
for $0.01 per Public Warrant unless the holder thereof exercises such Public Warrant, so long as the price per share of the Company’s
stock is above $16.50 for over any twenty (20) consecutive trading days. For more information, see “Summary of the Proxy statement
— Agreements to be Executed at Closing — Warrant Revenue Sharing Side Letter”. |
| ● | The Sponsor may receive up to 1,000,000
Earnout Shares if the Combined Company achieves certain milestones as follows: |
250,000 Sponsor Earnout Shares will be
earned and released upon satisfaction of the First Milestone Event (as defined in the Sponsor Earnout Agreement), which would have a
value of $4,125,000 with the stock price at $16.50;
350,000 Sponsor Earnout Shares will be
earned and released upon satisfaction of the Second Milestone Event (as defined in the Sponsor Earnout Agreement), which, including the
first tranche of 250,000 Earnout Shares, would have a total value of $13,800,000 with the stock price at $23.00; and
400,000 Sponsor Earnout Shares will be
earned and released upon satisfaction of the Third Milestone Event (as defined in the Sponsor Earnout Agreement), which, including the
first tranche of 250,000 Earnout Shares plus the second tranche of 350,000 Earnout Shares, would have a total value of $30,000,000 with
the stock price at $30.00.
| ● | If the Business Combination is completed,
assuming the stock price of the Combined Company is $30.00 per share, and (i) the Public
Warrants are exercised; (ii) the Private Warrants are exercised on a cashless exercise basis;
(iii) all Earnout Share Milestones are achieved; and (iv) the Sponsor and its affiliates
still hold 1,728,078 shares of Common stock (which includes 1,433,480 founder shares plus
294,598 shares included in the Private Units), the Sponsor stands to gain up to $13,188,016
for the exercise of the Public Warrants; $2,678,164 in value for the 89,272 shares with the
cashless exercise of the Private Warrants; $30,000,000 in value of the Earnout Shares; and
$51,842,340 in value of the 1,728,078 shares held, for a total of $97,708,520. |
| ● | On March
8, 2022, Abri issued a convertible promissory note (the “First Working Capital Note”) to the Sponsor. Pursuant
to the First Working Capital Note, the Sponsor agreed to loan us an aggregate principal amount of $300,000. On April 4, 2022, Abri issued
a second convertible promissory note for an aggregate principal amount of $500,000 (the “Second Working Capital Note”)
to the Sponsor. On August 26, 2022, Abri issued a third convertible promissory note for an aggregate principal amount of $300,000 (the
“Third Working Capital Note”) to the Sponsor. On November 22, 2022, Abri issued a fourth convertible promissory
note for an aggregate principal amount of $150,000 (the “Fourth Working Capital Note”) to the Sponsor. On January
17, 2023, Abri issued a fifth convertible promissory note for an aggregate principal amount of $200,000 (the “Fifth Working
Capital Note”) to the Sponsor. On February 10, 2023, Abri issued a sixth convertible promissory note for an aggregate principal
amount of $150,000 (the “Sixth Working Capital Note”) to the Sponsor and on July 31, 2023, the Company
issued a seventh working capital note in the amount of $11,250 (the “Seventh Working Capital Note”) to
the Sponsor (the First Working Capital Note through the Seventh Working Capital Notes are hereinafter referred to as the “Working
Capital Notes”). The Working Capital Notes were issued to fund working capital of the Company. The Working Capital Notes
are non-interest bearing and all outstanding amounts under the Working Capital Notes will be due on the date on which Abri consummates
its initial business combination (the “Maturity Date”). |
| ● | On August 5, 2022, Abri deposited $573,392 into the trust account
of Abri (the “Trust Account”), to extend the time to complete a Business Combination until November 12, 2022.
On November 1, 2022, Abri deposited $573,392 into the Trust Account for the second of two three-month extensions to extend the time to
complete a Business Combination until February 12, 2023. |
| ● | On February 6, 2023, March 10, 2023,
April 11, 2023, May 11, 2023, June 9, 2023 and July 10, 2023, Abri deposited $87,500 for
each one-month extension (or $4525,000 in total) into the Trust Account to extend the time
to complete a business combination to August 12, 2023. |
| ● | On
August 7, 2023, at the Second Extension Meeting, the Abri stockholders approved the proposal
to amend Abri’s Charter: (a) giving Abri the right to extend the date by which it has
to complete a business combination to February 12, 2024 without making any further deposits
into the Trust Account, and (b) to change the Charter by removing the requirement to have
net tangible assets of at least $5,000,001 upon consummation of a Business Combination |
| ● | If Abri is unable to complete a business
combination and distribute the proceeds held in trust to its public stockholders, Abri’s
Sponsor has agreed (subject to certain exceptions) that it will be liable to ensure that
the proceeds in the trust account are not reduced below $10.00 per share by the claims of
target businesses or claims of vendors or other entities that are owed money by Abri for
services rendered or contracted for or products sold to Abri. |
| ● | All rights specified in Abri’s
Charter as amended on December 9, 2022 and August 9, , relating to the right of officers
and directors to be indemnified by Abri, and Abri’s officers and directors to be exculpated
from monetary liability with respect to prior acts or omissions, will continue after a business
combination. If the Business Combination is not approved and Abri liquidates, Abri will not
be able to perform its obligations to its officers and directors under those provisions. |
| · | The exercise of Abri’s directors’
and officers’ discretion in agreeing to changes or waivers in the terms of the transaction may result in a conflict of interest
when determining whether such changes or waivers are appropriate and in Abri’s stockholders’ best interest. |
| · | Abri’s Sponsor, officers, directors, initial
stockholders or their affiliates, are entitled to reimbursement of out-of-pocket expenses incurred by them in connection with certain
activities on Abri’s behalf, such as identifying and investigating possible business targets and business combinations. However,
if Abri fails to consummate the Business Combination, they will not have any claim against the trust account for reimbursement. Accordingly,
Abri will most likely not be able to reimburse these expenses if the Business Combination is not completed, including any balances outstanding
on any Working Capital Notes, as described herein, issued to Abri by the Sponsor. |
| · | If a business combination is not consummated,
and there are insufficient funds to repay the Working Capital Notes, the automatic extension payments of $1,146,784, the five one month
extension payments of $87,500 for a total of $1,671,784 in extension payments through July 12, 2023, and any further Extension payments
made, all unpaid amounts would be forgiven. All or a portion of the amounts outstanding under the Working Capital Notes may be converted
on the Maturity Date into Units at a price of $10.00 per Unit at the option of the Sponsor. The Units would be identical to the Abri’s
outstanding Private Units that were issued to the Sponsor in the Private Placement. The Working Capital Notes contain customary events
of default, including, among others, those relating to the Abri’s failure to make a payment of principal when due and to perform
any other obligations that is not timely cured after written notice of such default from the Sponsor. |
See “Proposal No.
1 — The Business Combination Proposal — Interests of Certain Persons in the Business Combination” for additional information.
Current Value of Securities Held by the Sponsor
and its Affiliates.
As of September 252023, assuming
a stock price of $10.95 per share, the value of securities held by the Sponsor and its affiliates, is $18,922,454, which includes 1,433,480
Founder Shares, and 294,598 shares of Common Stock purchased in the Private Placement as part of the Private Placement Units.
Anticipated Accounting Treatment
The Business Combination will
be accounted for as a “reverse recapitalization,” with no goodwill or other intangible assets recorded, in accordance with
GAAP. A reverse recapitalization does not result in a new basis of accounting, and the financial statements of the combined entity represent
the continuation of the financial statements of DLQ in many respects.
Under this method of accounting,
Abri will be treated as the “acquired” company for financial reporting purposes. For accounting purposes, DLQ will be deemed
to be the accounting acquirer in the transaction and, consequently, the transaction will be treated as a recapitalization of DLQ (i.e.
a capital transaction involving the issuance of stock by Abri for the stock of DLQ). Accordingly, the consolidated assets, liabilities
and results of operations of DLQ will become the historical financial statements of the Combined Company, and Abri’s assets, liabilities
and results of operations will be consolidated with DLQ’s beginning on the acquisition date. Operations prior to the Business Combination
will be presented as those of DLQ in future reports. The net assets of DLQ will be recognized at carrying value, with no goodwill or other
intangible assets recorded.
Recommendations of the Board and Reasons for
the Business Combination
After careful consideration of
the terms and conditions of the Merger Agreement, the DLQ and Logiq’s Board has determined that Business Combination and the transactions
contemplated thereby are fair to, and in the best interests of, Logiq, and its stockholders. In reaching its decision with respect to
the Business Combination and the transactions contemplated thereby, the Board reviewed and evaluation various companies in comparable
sectors in the industry from publicly available sources including Factset. On August 30, 2022 DLQ, Inc. and Benchmark Company, LLC (“Benchmark”)
entered into an agreement where Benchmark agreed to act as the exclusive financial advisor relating to a merger of acquisition with a
publicly traded company. Benchmark acted merely as a high level advisor and provided DLQ with publicly available information related to
other SPAC deals from Factset. The companies were selected based on similar business segments and business verticals to those in which
DLQ operates. The Board recommends that the Logiq stockholders vote:
| · | FOR the Business Combination Proposal; and |
| · | FOR the Adjournment Proposal. |
Opinion of The Mentor Group Inc.
Abri’s board of directors
retained The Mentor Group, Inc. (“Mentor”), to act as a financial advisor to the Abri’s board in connection
with the Business Combination to render to the board an opinion as to the fairness to Abri’s stockholders, from a financial point
of view, of the consideration to be paid in the Business Combination. On December 4, 2022, Mentor delivered a written opinion and final
supporting analysis presentation to the effect that, as of that date and based upon and subject to the factors and assumptions set forth
therein, the consideration to be paid in the Business Combination pursuant to the Merger Agreement is fair to Abri’s stockholders
from a financial point of view.
Summary Risk Factors
In evaluating the Business Combination
and the Proposals to be considered and voted on at the Meeting, you should carefully review and consider the risk factors set forth under
the “Risk Factors” section beginning on page 50 of this proxy statement. Logiq, Abri and DLQ are subject to various risks
associated with their businesses and their industries including, but not limited to, the principal risk factors that are summarized below.
In addition, the Business Combination poses a number of risks to each company and its respective stockholders and members, including the
possibility that the Business Combination may not be completed.
Risks Related to DLQ’s Business
| · | As an early stage company entering a highly competitive
market with limited operating history, the operations of DLQ are still developing, unproven and subject to material legal, regulatory,
operational, reputational, financial, tax, market, credit and other risks. |
| · | DLQ has negative cash flow from operating activities.
There is no assurance that sufficient revenues will be generated in the near future. To the extent that DLQ has negative operating cash
flows in future periods, it may need to deploy a portion of its existing working capital to fund such negative cash flows. |
| · | DLQ is subject to risks associated with changing
technologies in the digital marketing industry, which could place DLQ at a competitive disadvantage. |
| · | DLQ may be subject to fines or other penalties
imposed by the Internal Revenue Service and other tax authorities. |
| · | Systems failures could cause interruptions in
DLQ’s services or decreases in the responsiveness of DLQ’s services which could harm DLQ’s business. |
| · | If DLQ’s security is breached, its business
could be disrupted, its operating results could be harmed, and customers could be deterred from using DLQ’s products and services. |
| · | Delays in the release of new or enhanced products
or services or undetected errors in DLQ’s products or services may result in increased costs, delayed market acceptance of their
products, and delayed or lost revenue. |
| · | Defects or errors in DLQ’s applications
could harm its reputation, result in significant costs and impair its ability to market their products and services. |
| · | If DLQ is unable to reliably meet their data
storage and management requirements, or if they experience any failure or interruption in the delivery of their services over the Internet,
customer satisfaction and DLQ’s reputation could be harmed and customer contracts may be terminated. |
| · | Upgrading DLQ’s products and services could
result in implementation issues and business disruptions. |
| · | New entrants and the introduction of other platforms
in DLQ’s markets may harm DLQ’s competitive position. |
| · | DLQ’s future success depends on their ability
to develop and successfully introduce new and enhanced products that meet the needs of our customers. |
| · | DLQ’s cost structure is partially fixed.
If their revenues decline and they are unable to reduce costs, their profitability will be adversely affected. |
| · | There can be no assurance that DLQ will be successful
in maintaining their existing contractual relationships with customers. |
| · | Attrition of customers and failure to attract
new customers could have a material adverse effect on DLQ’s business, financial condition and results of operations, and cash flows. |
| · | DLQ’s ability to sustain or increase revenues
will depend upon their success in entering new markets, continuing to increase their customer base, and in deriving additional revenues
from existing customers. |
| · | Some of DLQ’s products and services utilize
open source software, and any failure to comply with the terms of one or more of these open source licenses could adversely affect DLQ’s
business. |
| · | A pandemic, epidemic or outbreak of an infectious
disease in the United States or elsewhere may adversely affect DLQ’s business. |
| · | If DLQ is not successful in selecting and integrating
the businesses and technologies they acquire, or in managing their current and future divestitures, DLQ’s business may suffer. |
| · | If DLQ is unable to manage their growth and expand
their operations successfully, their business and operating results will be harmed and their reputation may be damaged. |
| · | DLQ may be unable to respond to customers’
demands for new digital marketing solutions and service offerings. |
| · | Increasing competition and increasing costs within
DLQ’s customers’ industries may affect the demand for their products and services, which may affect its results of operations
and financial condition. |
| · | DLQ’s insurance coverage may be insufficient
to avoid material impact on their financial position or results of operations resulting from claims or liabilities against DLQ. |
| · | Any negative commentaries made by any regulatory
agencies or any failure by DLQ to comply with applicable regulations and related guidance could harm their reputation and operating results,
and compliance with new regulations and guidance may result in additional costs. |
| · | Current and future litigation against DLQ, which may arise in the ordinary course of business, could be
costly and time consuming to defend. |
| · | DLQ could incur substantial costs resulting from
product liability claims relating to their products or services or their customers’ use of their products or services. |
| · | Cybersecurity and data privacy incidents or breaches
may damage client relations and inhibit DLQ’s growth. |
Risks Related to DLQ’s Intellectual
Property
| · | DLQ may be unable to adequately enforce or defend their ownership
and use of DLQ’s intellectual property and other proprietary rights. |
| · | DLQ relies on third-party providers to license certain intellectual
property and to provide internet services, and any failure by these third-party providers could cause DLQ to lose customers and subject
it to claims for credits or damages, among other things. |
| · | If DLQ is unable to transfer existing customers or acquire new
customers, its operating results will be harmed. |
| · | DLQ’s use of open source technology could impose limitations
on its ability to commercialize its software. |
| · | Claims by others that DLQ infringes their intellectual property
or trade secret rights could harm their business. |
| · | DLQ’s software products may have bugs, which could result
in delayed or lost revenue, expensive correction, liability to its customers and claims against us. |
| · | DLQ may be unable to respond quickly enough to changes in technology
and technological risks and to develop its intellectual property into commercially viable products and services. |
Risks Related to DLQ’s Personnel
| · | DLQ depends on talented, experienced and committed personnel
to operate and grow DLQ’s business and may incur increased operational costs to recruit, train, motivate and/or retain them. If
DLQ is unable to do so, DLQ’s business, financial condition, results of operations and prospects may be adversely affected. |
Risks Related to Abri’s Business and
the Business Combination
| · | Abri will be forced to liquidate the Trust Account if it cannot
consummate a business combination by February 12, 2024, In the event of a liquidation, the Abri public stockholders will receive $10.00
per share and the Abri Warrants will expire worthless. |
| · | If third parties bring claims against Abri, the proceeds held in trust
could be reduced and the per share liquidation price received by holders of shares of Common Stock may be less than $10.68. |
| · | If Abri’s due diligence investigation of DLQ was inadequate,
then stockholders of Abri following the Business Combination could lose some or all of their investment. |
| · | Stockholder litigation and regulatory inquiries and investigations
are expensive and could harm Abri’s business, financial condition and operating results and could divert management attention. |
| · | Abri and DLQ have incurred and expect to incur significant costs
associated with the Business Combination. |
| · | Abri will incur significant transaction costs in connection
with transactions contemplated by the Merger Agreement. Whether or not the Business Combination is completed, the incurrence of these
costs will reduce the amount of cash available to be used for other corporate purposes by Abri if the Business Combination is completed
or by Abri if the Business Combination is not completed. |
| · | Abri will incur significant transaction costs in connection
with transactions contemplated by the Merger Agreement. |
Risks Related to the Combined Company’s
Common Stock
| · | The market price of the Combined Company’s Common Stock
is likely to be highly volatile, and you may lose some or all of your investment. |
| · | Volatility in the Combined Company’s share price could
subject the Combined Company to securities class action litigation. |
| · | An active, liquid trading market for the Combined Company’s
Common Stock may not develop, which may limit your ability to sell your shares. |
| · | The issuance of additional shares of common stock, preferred
stock or other convertible securities may dilute your ownership and could adversely affect the stock price. |
| · | The Combined Company may be subject to securities litigation,
which is expensive and could divert management attention. |
Recent Developments
Nasdaq Deficiency Notice
On March 23, 2023, Abri received
a letter (the “MVLS Notice”) from the Listing Qualifications Department (the “Staff”)
of The Nasdaq Stock Market LLC (“Nasdaq”) notifying Abri that for the last 30 consecutive business days prior
to the date of the MVLS Notice, Abri’s Minimum Value of Listed Securities (“MVLS”) was less than $35.0
million, which does not meet the requirement for continued listing on The Nasdaq Capital Market, as required by Nasdaq Listing Rule 5550(b)(2)
(the “MVLS Rule”). In accordance with Nasdaq Listing Rule 5810(c)(3)(C), the Staff has provided Abri with 180 calendar days,
or until September 19, 2023, to regain compliance with the MVLS Rule. The MVLS Notice has no immediate effect on the listing of Abri’s
securities on The Nasdaq Capital Market.
If Abri regains compliance
with the MVLS Rule, the Staff will provide written confirmation to Abri and close the matter. To regain compliance with the MVLS Rule,
the Company’s MVLS must meet or exceed $35.0 million for a minimum of ten consecutive business days during the 180-day compliance
period ending on September 19, 2023. In the event Abri does not regain compliance with the MVLS Rule prior to the expiration of the compliance
period, it will receive written notification that its securities are subject to delisting. At that time, Abri may appeal the delisting
determination to a Hearings Panel.
SELECTED HISTORICAL FINANCIAL DATA OF ABRI
Abri’s Statement of
Operations data for the three months ended June 30, 2023 and the year ended December 31, 2022 and balance sheet data as of June 30, 2023
and December 31, 2022 are derived from Abri’s interim and audited financial statements, respectively, included elsewhere in this
registration statement.
The historical results of
Abri included below and elsewhere in this proxy statement are not necessarily indicative of the future performance of Abri. You should
read the following selected financial data in conjunction with “Management’s Discussion and Analysis of Financial Condition
and Results of Operations of Abri” and the financial statements and the related notes appearing elsewhere in this proxy statement.
| Balance Sheet Data: | |
As
of
June 30,
2023 | | |
As
of
December 31,
2022 | |
| Working capital (deficit) | |
$ | (2,743,844 | ) | |
$ | (1,921,061 | ) |
| Trust account | |
| 13,650,778 | | |
| 12,841,399 | |
| Total assets | |
| 13,915,134 | | |
| 13,475,155 | |
| Total liabilities | |
| 7,752,795 | | |
| 6,469,277 | |
| Value of Common Stock subject to redemption | |
| 13,450,571 | | |
| 12,841,399 | |
| Stockholders’ (deficit) | |
| (7,288,232 | ) | |
| (5,835,521 | ) |
| For the six months ended June 30, 2023 and the year ended December 31, 2022: | |
For the
Six Months
Ended
June 30,
2023 | | |
For the
Year Ended
December 31,
2022 | |
| Revenues | |
$ | — | | |
$ | — | |
| Loss from operations | |
| (1,105,905 | ) | |
| (3,368,778 | ) |
| Income on Trust Account | |
| 303,001 | | |
| 834,403 | |
| Change in fair value of warrants | |
| 7,365 | | |
| 153,193 | |
| Provision for income taxes | |
| (48,000 | ) | |
| (119,000 | ) |
| Net loss | |
$ | (843,539 | ) | |
$ | (2,500,184 | ) |
| Basic net loss per share, shares subject to redemption | |
$ | (0.00 | ) | |
$ | (0.06 | ) |
| Weighted average Common Stock outstanding – basic, redeemable Common Stock | |
| 1,252,372 | | |
| 5,463,799 | |
| Diluted net loss per share, non-redeemable shares | |
$ | (0.49 | ) | |
$ | (1.25 | ) |
| Weighted average shares outstanding – diluted, non-redeemable Common Stock | |
| 1,728,078 | | |
| 1,728,078 | |
SELECTED HISTORICAL CONSOLIDATED
FINANCIAL DATA OF DLQ
DLQ Statement of Operations
data for the three months ended June 30, 2023 and the twelve months from January 1, 2022 through December 31, 2022 and balance sheet data
as of June 30, 2023 and December 31, 2022 are derived from DLQ’s interim and audited financial statements, respectively, included
elsewhere in this registration statement. DLQ statement of operations data for the year ended December 31, 2022 and the twelve months
from January 1, 2021 through December 31, 2021 and balance sheet data as of December 31, 2022 and 2021 are derived from DLQ’s audited
financial statements, respectively, included elsewhere in this registration statement.
The historical results of
DLQ included below and elsewhere in this proxy statement are not necessarily indicative of the future performance of DLQ. You should read
the following selected financial data in conjunction with “Management’s Discussion and Analysis of Financial Condition and
Results of Operations of DLQ” and the financial statements and the related notes appearing elsewhere in this proxy statement.
| Balance Sheet Data: | |
As of
June 30,
2023 | | |
As of
December 31,
2022 | |
| Working capital (deficit) | |
$ | (2,519,576 | ) | |
$ | (2,268,019 | ) |
| Total assets | |
| 17,182,965 | | |
| 18,555,206 | |
| Total liabilities | |
| 12,800,801 | | |
| 12,249,276 | |
| Value of Common Stock subject to redemption | |
| | | |
| — | |
| Stockholders’ equity | |
| 4,382,164 | | |
| 6,305,930 | |
| For the Six Months Ended June 30, 2023 and Year Ended December 31, 2022 | |
For the
six months
ended
June 30,
2023 | | |
For the
Twelve months
ending
December 31,
2022 | |
| Revenues | |
$ | 8,398,088 | | |
$ | 20,235,536 | |
| Loss from operations | |
| (2,503,843 | ) | |
| (5,480,585 | ) |
| Net loss | |
$ | (2,589,516 | ) | |
$ | (5,565,317 | ) |
| Basic and diluted net income per share, shares subject to redemption | |
| | | |
| | |
| Weighted average Common Stock outstanding – basic and diluted | |
| 2,000 | | |
| 2,000 | |
| Basic and diluted net loss per share | |
$ | (1,294.76 | ) | |
$ | (2,782.66 | ) |
TRADING MARKET AND DIVIDENDS
Abri
Units, shares of Common Stock, Common
Stock, and Warrants
The Units, shares of Common
Stock and Warrants are each quoted on the Nasdaq Stock Market, under the symbols “ASPAU,” “ASPA,” and “ASPAW,”
respectively. Each of Abri’s Units consists of one share of Common Stock and one Warrant. Each Warrant entitles the holder
thereof to purchase one share of Common Stock at a price of $11.50 per share. The Units, shares of Common Stock and Warrants commenced
trading on the Nasdaq Stock Market separately on September 3, 2021. The Common Stock will not trade separately unless and until Abri
consummates an initial business combination.
Abri’s Dividend Policy
Abri has not paid any cash
dividends on its shares of Abri Common Stock to date and does not intend to pay cash dividends prior to the completion of a business combination.
The payment of cash dividends in the future will be dependent upon Abri’s revenues and earnings, if any, capital requirements and
general financial condition subsequent to completion of a business combination. Further, if Abri incurs any indebtedness, Abri’s
ability to declare dividends may be limited by restrictive covenants Abri may agree to in connection therewith. The payment of any dividends
subsequent to a business combination will be within the discretion of the Combined Company’s board of directors. It is the present
intention of the Board to retain all earnings, if any, for use in its business operations and, accordingly, the board does not anticipate
declaring any dividends in the foreseeable future.
DLQ Parent
Shares of Abri Common Stock and
Holders of DLQ Parent stock
Upon Closing, DLQ Parent will
own approximately 43.6% of the total issued and outstanding shares of Abri Common Stock (based on no additional redemptions), or up to
45.9% of the total issued and outstanding shares of Abri Common Stock (based on Maximum Redemptions), and DLQ Parent Stockholders will
own approximately 27.2% of the total issued and outstanding shares of Abri Common Stock (based on no redemptions), or up to 28.6% of the
total issued and outstanding shares of Abri Common Stock (based on Maximum Redemptions). ). and DLQ Investors will own approximately 11.6%
of the total issued and outstanding shares of Abri Common Stock (based on no redemptions), or up to 12.2% of the total issued and outstanding
shares of Abri Common Stock (based on Maximum Redemptions). DLQ Parent’s common stock is listed on OTCQX under the symbol “LGIQ”.
DLQ Parent had 602 stockholders of record as of September 25, 2023. The closing price of DLQ Parent’s stock on September 28, 2023
was $0.24.
Dividend Policy of DLQ Parent
DLQ Parent has not paid any cash dividends on its stock to date and does
not intend to pay cash dividends prior to Closing. The Dividend Shares and Distribution of such referenced herein is contingent upon the
approval of the Merger by the Abri Stockholders, DLQ Parent stockholders and the subsequent Closing. A separate record date based on the
then DLQ Parent ownership will be set for the Distribution at that time.
DLQ
Holders of DLQ stock
As a wholly-owned subsidiary
of DLQ Parent as of the Record Date, there was one (1) holder of record of DLQ stock.
Dividend Policy of DLQ
DLQ has not paid any cash
dividends on its stock to date and does not intend to pay cash dividends prior to Closing. The payment of dividends in the future is dependent
upon DLQ’s revenues and income, if any, capital requirements, the terms of any indebtedness and general financial condition subsequent
to completion of the Business Combination. The payment of any dividends subsequent to the Business Combination will be within the discretion
of the DLQ board of directors at such time.
Combined Company
Dividend Policy
Following Closing, the Combined
Company’s board of directors will consider whether or not to institute a dividend policy. It is presently intended that the Combined
Company retain its earnings for use in business operations and accordingly, it is not anticipated that the Combined Company’s board
of directors will declare any dividends in the foreseeable future.
RISK FACTORS
You should carefully review
and consider the following risk factors and the other information contained in this proxy statement, including its annexes and the matters
addressed in the section entitled “Cautionary Note Regarding Forward-Looking Statements,” in evaluating the business
combination before you decide whether to vote or instruct your vote to be cast to approve the proposals described in this proxy statement.
DLQ, Abri or Merger Sub may face additional risks and uncertainties that are not presently known to DLQ, Abri or Merger Sub, or that DLQ,
Abri or Merger Sub currently deems immaterial, which may also impair DLQ’s, Abri’s or Merger Sub’s business or financial
condition and could adversely affect the trading price of the Common Stock. The following discussion should be read in conjunction with
the “Management’s Discussion and Analysis of Financial Condition and Results of Operations of DLQ,” the financial statements
of DLQ and notes to the financial statements included herein. In this section and unless the context otherwise requires, references to
“DLQ” refer to (i) for periods prior to Closing, DLQ, Inc., and all of its subsidiaries; and (ii) for periods following
Closing, Collective Audience, Inc. as the Combined Company and all of its subsidiaries.
Risks Related to DLQ’s Business
Negative Operating Cash Flow
DLQ has negative cash flow
from operating activities. There is no assurance that sufficient revenues will be generated in the near future. To the extent that DLQ
has negative operating cash flows in future periods, it may need to deploy a portion of its existing working capital to fund such negative
cash flows.
DLQ is subject to risks associated with
changing technologies in the digital marketing industry, which could place DLQ at a competitive disadvantage.
The successful implementation
of DLQ’s business strategy requires DLQ to continuously evolve its existing solutions and introduce new solutions to meet customers’
needs. DLQ believes that its customers rigorously evaluate DLQ’s solution and service offerings on the basis of a number of factors,
including, but not limited to: quality; price competitiveness; technical expertise and development capability; innovation; reliability
and timeliness of delivery; operational flexibility; customer service; and overall management.
DLQ’s success depends
on their ability to continue to meet its customers’ changing requirements and specifications with respect to these and other criteria.
There can be no assurance that DLQ will be able to address technological advances or introduce new offerings that may be necessary to
remain competitive within the digital marketing industry.
Systems failures could cause interruptions
in DLQ’s services or decreases in the responsiveness of DLQ’s services which could harm DLQ’s business.
If DLQ’s systems fail
to perform for any reason, they could experience disruptions in operations, slower response times, or decreased customer satisfaction.
DLQ’s ability to provide digital marketing services successfully and provide high quality customer service depends on the efficient
and uninterrupted operation of its hosting company’s computer and communications hardware and software systems. Although unlikely,
DLQ’s hosting company’s systems are vulnerable to damage or interruption from human error, natural disasters, power loss,
telecommunication failures, break-ins, sabotage, computer viruses, intentional acts of vandalism, and similar events. Any systems failure
that causes an interruption in DLQ’s services or decreases the responsiveness of DLQ’s services could impair their reputation,
damage our brand name, and materially adversely affect DLQ’s business, financial condition and results of operations and cash flows.
If DLQ’s security
is breached, its business could be disrupted, its operating results could be harmed, and customers could be deterred from using DLQ’s
products and services.
DLQ’s business relies
on the secure electronic transmission, storage, and hosting of sensitive information, including financial information, and other sensitive
information relating to its customers, company, and workforce. As a result, DLQ face some risk of a deliberate or unintentional incident
involving unauthorized access to its computer systems (including, among other methods, cyber- attacks or social engineering) that could
result in misappropriation or loss of assets or sensitive information, data corruption, or other disruption of business operations. In
light of this risk, DLQ have devoted significant resources to protecting and maintaining the confidentiality of its information, including
implementing security and privacy programs and controls, training DLQ’s workforce, and implementing new technology. DLQ has no guarantee
that these programs and controls will be adequate to prevent all possible security threats. DLQ believes that any compromise of its electronic
systems, including the unauthorized access, use, or disclosure of sensitive information or a significant disruption of its computing assets
and networks, would adversely affect its reputation and ability to fulfill contractual obligations, and would require DLQ to devote significant
financial and other resources to mitigate such problems, and could increase future cyber security costs. Moreover, unauthorized access,
use, or disclosure of such sensitive information could result in contractual or other liability. In addition, any real or perceived compromise
of DLQ’s security or disclosure of sensitive information may result in lost revenues by deterring customers from using or purchasing
DLQ’s products and services in the future or prompting them to use competing service providers.
Delays in the release of new or enhanced
products or services or undetected errors in DLQ’s products or services may result in increased costs, delayed market acceptance
of their products, and delayed or lost revenue.
To achieve market acceptance,
new or enhanced products or services can require long development and testing periods, which may result in delays in scheduled introduction.
Any delays in the release schedule for new or enhanced products or services may delay market acceptance of these products or services
and may result in delays in new or existing customers from using these new or enhanced products or services or the loss of new or existing
customers. In addition, new or enhanced products or services may contain a number of undetected errors or “bugs” when they
are first released. Although DLQ extensively tests each new or enhanced product or service before it is released to the market, there
can be no assurance that significant errors will not be found in existing or future releases. As a result, in the months following
the introduction of certain releases, DLQ may need to devote significant resources to correct these errors. There can be no assurance,
however, that all of these errors can be corrected.
Defects or errors in DLQ’s platform
and products could harm its reputation, result in significant costs and impair its ability to market their products and services.
DLQ’s products and software
may contain defects or errors, some of which may be material. Errors may result from DLQ’s own technology or from DLQ’s cloud-based
solutions with legacy systems and data, which DLQ did not develop. The risk of errors is particularly significant when a new product is
first introduced or when new versions or enhancements of existing products are released. The likelihood of errors is increased when DLQ
has more frequent releases of new products, services and enhancements of existing products. DLQ has, from time to time, found defects
in their software. Although these past defects have not resulted in any litigation against DLQ to date, they have invested significant
capital, technical, managerial, and other resources to investigate and correct these past defects and they have needed to divert these
resources from other development efforts. In addition, material performance problems or defects in DLQ’s products may arise in the
future. Material defects in DLQ’s cloud-based solutions could result in a reduction in sales, delay in market acceptance of services,
or credits or refunds to DLQ’s customers. In addition, such defects may lead to the loss of existing customers and difficulty in
attracting new customers, diversion of development resources, or harm to DLQ’s reputation. Correction of defects or errors could
prove to be impossible or impractical. The costs incurred in correcting any defects or errors or in responding to resulting claims or
liability may be substantial and could adversely affect DLQ’s operating results.
If DLQ is unable to reliably meet their
data storage and management requirements, or if they experience any failure or interruption in the delivery of their services over the
Internet, customer satisfaction and DLQ’s reputation could be harmed and customer contracts may be terminated.
As part of DLQ’s current
business model, it delivers its services over the Internet and store and manage hundreds of terabytes of data for its customers, resulting
in substantial information technology infrastructure and ongoing technological challenges, which it expects to continue to increase over
time. If DLQ does not reliably meet these data storage and management requirements, or if they experience any failure or interruption
in the delivery of their services over the Internet, customer satisfaction and reputation could be harmed, leading to reduced revenues
and increased expenses. DLQ’s hosting services are subject to service-level agreements and, in the event that they fail to meet
guaranteed service or performance levels, they could be subject to customer credits or termination of these customer contracts. If the
cost of meeting these data storage and management requirements increases, DLQ’s results of operations could be harmed.
Upgrading DLQ’s products and services
could result in implementation issues and business disruptions.
DLQ updates their products
and services on a periodic basis. In doing so, they face the possibility that existing customers will find the updated product and/or
service unacceptable, or new customers may not be as interested as they have been in the past versions. Furthermore, translation errors
might introduce new software and/or technical bugs that will not be caught.
New entrants and the introduction of other
platforms in DLQ’s markets may harm DLQ’s competitive position.
The markets for development,
distribution, and sale of offering SMB’s digital marketing solutions to establish a brand presence for their business are rapidly
evolving. New entrants seeking to gain market share by introducing new technology, new products, and new platforms may make it more difficult
for DLQ to sell their products and services which could create increased pricing pressure, reduced profit margins, increased sales and
marketing expenses, or the loss of market share or expected market share, any of which may significantly harm our business, operating
results and financial condition.
DLQ’s future success depends on their
ability to develop and successfully introduce new and enhanced products that meet the needs of our customers.
DLQ’s sales depend on
their ability to anticipate our existing and prospective customers’ needs and develop products and services that address those needs.
DLQ’s future success will depend on their ability to develop new products and strategies, anticipate technological improvements
and enhancements, and to develop products that are competitive in the rapidly changing digital marketing industry. Introduction of new
products and product enhancements will require coordination of DLQ’s efforts with their customers to develop products that offer
performance metrics and features desired by their customers and performance and functionality superior or more cost effective than solutions
offered by our competitors. If DLQ fails to coordinate these efforts, develop product enhancements or introduce new products that meet
the needs of their customers as scheduled, its operating results will be materially and adversely affected, and DLQ’s business and
prospects will be harmed. DLQ cannot assure that product introductions will meet their anticipated release schedules or that their products
will be competitive in the market. Furthermore, given the rapidly changing nature of the mobile apps market, there can be no assurance
DLQ’s products and technology will not be rendered obsolete by alternative or competing technologies.
DLQ’s cost structure is partially
fixed. If their revenues decline and they are unable to reduce costs, their profitability will be adversely affected.
DLQ’s cost structure
is partially fixed, and if their revenues decrease, these fixed costs will not be reduced. DLQ bases their cost structure on historical
and expected levels of demand for DLQ’s services, as well as fixed operating infrastructure, such as computer hardware, software,
and staffing levels. If demand for DLQ’s services declines, and as a result, DLQ’s revenues decline, DLQ may not be able to
adjust its cost structure on a timely basis and their profitability may be materially adversely affected.
DLQ has substantial customer concentration,
with a limited number of customers accounting for a substantial portion of our Revenues.
DLQ currently derives a significant
portion of its revenue from two customers. Approximately 53% of revenues were generated from these two customers for the year ended December
31, 2022 and 21% of revenues were generated from three (3) customers for the year ended December 31, 2021. There are inherent risks whenever
a large percentage of total revenues are concentrated with a limited number of customers. It is not possible for DLQ to predict the future
level of demand for its services that will be generated by these customers or the future demand for the products and services of these
customers in the end-user marketplace. In addition, revenues from these larger customers, especially DLQ’s three largest customers,
may fluctuate from time to time based on the commencement and completion of projects, the timing of which may be affected by market conditions
or other facts, some of which may be outside of DLQ’s control. Further, some of DLQ’s contracts with these larger customers
permit them to terminate DLQ’s services at any time (subject to notice and certain other provisions). If any of these customers
experience declining or delayed sales due to market, economic or competitive conditions, DLQ could be pressured to reduce the prices they
charge for services which could have an adverse effect on DLQ’s margins and financial position, and could negatively affect DLQ’s
revenues and results of operations and/or trading price of its common stock. If any of DLQ’s largest customers terminates their
services, such termination would negatively affect DLQ’s revenues and results of operations and/or trading price of its common stock.
There can be no assurance that DLQ will
be successful in maintaining their existing contractual relationships with customers.
DLQ’s customers have
in the past, and may in the future, negotiate agreements that are short-term and subject to renewal, non-exclusive and/or terminable at
the option of the customer on relatively short notice or no notice and without penalty. In the event that such contracts are terminated,
the customer is generally required to pay DLQ costs associated with any work completed as of the date of the termination. While contract
termination is rare, there can be no assurance that long-term contractual relationships will not be terminated, which could adversely
affect DLQ.
Attrition of customers and failure to attract
new customers could have a material adverse effect on DLQ’s business, financial condition and results of operations, and cash flows.
Although DLQ offers digital
marketing services designed to support and retain their customers, their efforts to attract new customers or prevent attrition existing
customers may not be successful. If DLQ is unable to retain existing customers or acquire new customers in a cost-effective manner, their
business, financial condition and results of operations, and cash flows would likely be adversely affected. Although DLQ has spent significant
resources on business development and related expenses and plans to continue to do so, these efforts may not be cost-effective at attracting
new customers.
DLQ’s ability to sustain or increase
revenues will depend upon their success in entering new markets, continuing to increase their customer base, and in deriving additional
revenues from existing customers.
One component of DLQ’s
overall business strategy is to derive more revenues from existing customers by expanding their use of DLQ products and services. Such
strategy would have DLQ customers utilize its platforms and their tools and components to leverage vast amounts of information stored
in both corporate databases and public data sources in order to make informed business decisions during the research and development process.
In addition, DLQ seeks to expand into new markets, and new areas within DLQ’s existing markets, by potentially acquiring businesses
in these markets, attracting and retaining personnel knowledgeable in these markets, identifying the needs of these markets, and developing
marketing programs to address these needs. If successfully implemented, these strategies could increase the usage of DLQ’s platforms
from SMBs operating within DLQ’s existing customer base, as well as by new customers in other industries. However, if these strategies
are not successfully implemented, DLQ’s products and services may not achieve market acceptance or penetration in targeted new departments
within their existing customers or in new industries. As a result, DLQ may incur additional costs and expend additional resources without
being able to sustain or increase revenue.
Some of DLQ’s products and services
utilize open source software, and any failure to comply with the terms of one or more of these open source licenses could adversely affect
DLQ’s business.
Some of DLQ’s products
utilize software covered by open source licenses. Open source software is typically freely accessible, usable and modifiable, and is used
by DLQ’s development team in an effort to reduce development costs and speed up the development process. Certain open source software
licenses require a user who intends to distribute the open source software as a component of the user’s software to disclose publicly
part or all of the source code to the user’s software. In addition, certain open source software licenses require the user of such
software to make any derivative works of the open source code available to others on unfavorable terms or at no cost. This can subject
previously proprietary software to open source license terms. While DLQ monitors the use of all open source software in their products,
processes and technology, in some areas of their business they do not have written policies and procedures for managing against the risks
of potential copyright or other intellectual property infringement claims made by third parties. Enforcement of such intellectual property
rights may have an adverse effect on their business, such as, for example, following inadvertent use of open source software that requires
them to disclose or make available the source code to related products.
A pandemic, epidemic or outbreak of an infectious
disease in the United States or elsewhere may adversely affect DLQ’s business.
If a pandemic, epidemic or
outbreak of an infectious disease occurs in the United States or elsewhere, DLQ’s business may be adversely affected.
COVID-19 has spread worldwide
and has resulted in government authorities implementing numerous measures to try to contain it, such as travel bans and restrictions,
quarantines, shelter-in-place orders and shutdowns. These measures have impacted, and may further impact, DLQ’s workforce and operations,
the operations of DLQ’s customers and DLQ’s partners, and those of their respective vendors and suppliers. DLQ’s critical
business operations, including their headquarters, are located in regions which have been impacted by COVID-19. DLQ’s customers
worldwide have also been affected and may continue to be affected by COVID-19 related restrictions and closures.
The spread of COVID-19
has caused DLQ to modify their business practices as they comply with state mandated requirements for safety in the workplace to ensure
the health, safety and well-being of DLQ employees. These measures include personal protective equipment, social distancing, cleanliness
of the facilities and daily monitoring of the health of employees in DLQ facilities, as well as modifying DLQ policies on employee travel
and the cancellation of physical participation in meetings, events and conferences. DLQ may take further actions as required by government
authorities or that they determine are in the best interests of DLQ employees, customers, partners and suppliers. However, DLQ has not
developed a specific and comprehensive contingency plan designed to address the challenges and risks presented by the COVID-19 pandemic
and, even if and when DLQ does develop such a plan, there can be no assurance that such plan will be effective in mitigating the potential
adverse effects on DLQ’s business, financial condition and results of operations.
In addition, while the extent
and duration of the COVID-19 pandemic on the global economy and DLQ’s business in particular is difficult to assess or predict,
the pandemic has resulted in, and may continue to result in, significant disruption of global financial markets, which may reduce their
ability to access capital or DLQ’s customers’ ability to pay them for past or future purchases, which could negatively affect
their liquidity. A recession or financial market correction resulting from the lack of containment and spread of COVID-19 could impact
overall technology spending, adversely affecting demand for DLQ products, its business and the value of DLQ’s common stock.
The ultimate impact of the COVID-19
pandemic or a similar health epidemic is highly uncertain and subject to change. The extent of the impact of the COVID-19 pandemic
on DLQ’s operational and financial performance, including their ability to execute their business strategies and initiatives in
the expected time frame, will depend on future developments, including, but not limited to, the duration and continued spread of the pandemic,
its severity, the actions to contain the disease or treat its impact, further related restrictions on travel, and the duration, timing
and severity of the impact on customer spending, including any recession resulting from the pandemic, all of which are uncertain and cannot
be predicted. An extended period of economic disruption as a result of the COVID-19 pandemic could have a material negative impact
on DLQ’s business, results of operations, access to sources of liquidity and financial condition, though the full extent and duration
is uncertain.
If DLQ is not successful in selecting and
integrating the businesses and technologies they acquire, or in managing their current and future divestitures, DLQ’s business may
suffer.
Over the years, DLQ has
expanded their business through acquisitions. DLQ continues to search to acquire businesses and technologies and form strategic alliances.
However, businesses and technologies may not be available on terms and conditions DLQ finds acceptable. DLQ risks spending time and money
investigating and negotiating with potential acquisition or alliance partners, but not completing transactions. Even if completed, acquisitions
and alliances involve numerous risks which may include: difficulties in achieving business and continuing financial success; difficulties
and expenses incurred in assimilating and integrating operations, services, products, technologies, or pre-existing relationships with
DLQ customers, distributors, and suppliers; challenges with developing and operating new businesses, including those which are materially
different from DLQ’s existing businesses and which may require the development or acquisition of new internal capabilities and expertise;
challenges of maintaining staffing at the acquired entities, including loss of key employees; potential losses resulting from undiscovered
liabilities of acquired companies that are not covered by the indemnification DLQ may obtain from the seller(s); the presence or absence
of adequate internal controls and/or significant fraud in the financial systems of acquired companies; diversion of management’s
attention from other business concerns; acquisitions could be dilutive to earnings, or in the event of acquisitions made through the issuance
of DLQ common stock to the shareholders of the acquired company, dilutive to the percentage of ownership of the existing shareholders;
new technologies and products may be developed which cause businesses or assets DLQ acquires to become less valuable; and risks that disagreements
or disputes with prior owners of an acquired business, technology, service, or product may result in litigation expenses and distribution
of DLQ’s management’s attention. In the event that an acquired business or technology or an alliance does not meet DLQ’s
expectations, DLQ results of operations may be adversely affected.
Some of the same risks exist
when DLQ decides to sell a business, site, product line, or division. In addition, divestitures could involve additional risks, including
the following: difficulties in the separation of operations, services, products, and personnel; and the need to agree to retain or assume
certain current or future liabilities in order to complete the divestiture. DLQ evaluates the performance and strategic fit of its businesses.
These and any divestitures may result in significant write-offs, including those related to goodwill and other intangible assets, which
could have an adverse effect on DLQ’s results of operations and financial condition. In addition, DLQ may encounter difficulty in
finding buyers or alternative exit strategies at acceptable prices and terms and in a timely manner. DLQ may not be successful in managing
these or any other significant risks that DLQ encounter in divesting a business, site, product line, or division, and as a result, DLQ
may not achieve some or all of the expected benefits of the divestitures.
If DLQ is unable to manage their growth
and expand their operations successfully, their business and operating results will be harmed and their reputation may be damaged.
DLQ has expanded their operations
significantly since inception and anticipate that further significant expansion will be required to achieve its business objectives. The
growth and expansion of their business and product offerings places a continuous and significant strain on their management, operational,
and financial resources. Any such future growth would also add complexity to and require effective coordination throughout the organization.
To manage any future growth effectively, DLQ must continue to improve and expand their information technology and financial infrastructure,
their operating and administrative systems and controls, and their ability to manage headcount, capital and processes in an efficient
manner. DLQ may not be able to successfully implement improvements to these systems and processes in a timely or efficient manner, which
could result in additional operating inefficiencies and could cause its costs to increase more than planned. If DLQ does increase their
operating expenses in anticipation of the growth of their business and this growth does not meet DLQ’s expectations, their operating
results may be negatively impacted. If DLQ is unable to manage future expansion, their ability to provide high quality products and services
could be harmed, which could damage their reputation and brand and may have a material adverse effect on their business, operating results,
and financial condition.
DLQ may be unable to respond to customers’
demands for new digital marketing solutions and service offerings, and their business, financial condition and results of operations,
and cash flows may be materially adversely affected.
DLQ’s customers may
demand new digital marketing solutions and service offerings. If DLQ fails to identify these demands from customers or update its offerings
accordingly, new offerings provided by DLQ’s competitors may render their existing solutions and services less competitive. DLQ’s
future success will depend, in part, on their ability to respond to customers’ demands for new offerings on a timely and cost-effective
basis and to adapt to address the increasingly sophisticated requirements and varied needs of their customers and prospective customers.
DLQ may not be successful in developing, introducing or marketing new offerings. In addition, their new offerings may not achieve market
acceptance. Any failure on their part to anticipate or respond adequately to customer requirements, or any significant delays in the development,
introduction or availability of new offerings or enhancements of current offerings could have a material adverse effect on DLQ’s
business, financial condition and results of operations and cash flows.
Increasing competition and increasing costs
within DLQ’s customers’ industries may affect the demand for their products and services, which may affect its results of
operations and financial condition.
DLQ’s customers’
demand for their products is impacted by continued demand for their products and by their customers’ research and development costs,
budget costs, and capital expenditures. Demand for DLQ’s customers’ products could decline, and prices charged by their customers
for their products may decline, as a result of increasing competition that their customers face in their respective industries. In addition,
DLQ’s customers’ expenses could continue to increase as a result of increasing costs of complying with government regulations
and other factors. A decrease in demand for their customers’ products, pricing pressures associated with the sales of these products,
and additional costs associated with product development could cause DLQ’s customers to reduce their research and development costs,
budget costs, and capital expenditures. Although DLQ believes its products can help their customers increase productivity, generate additional
sales, and reduce costs in many areas, because their products and services depend on such research and development, budget, and capital
expenditures, DLQ’s revenues may be significantly reduced.
DLQ’s insurance coverage may be insufficient
to avoid material impact on their financial position or results of operations resulting from claims or liabilities against DLQ, and they
may not be able to obtain insurance coverage in the future.
DLQ maintains insurance coverage
for protection against many risks of liability. The extent of DLQ’s insurance coverage is under continuous review and is modified
as they deem it necessary. Despite this insurance, it is possible that claims or liabilities against DLQ may have a material adverse impact
on their financial position or results of operations. In addition, DLQ may not be able to obtain any insurance coverage, or adequate insurance
coverage, when its existing insurance coverage expires.
Any negative commentaries made by any regulatory
agencies or any failure by DLQ to comply with applicable regulations and related guidance could harm their reputation and operating results,
and compliance with new regulations and guidance may result in additional costs.
Any negative commentaries
made by any regulatory agencies or any failure on DLQ’s part to comply with applicable regulations could result in the termination
of customers using their products and services. This could harm DLQ’s reputation, their prospects for generating future revenue,
and their operating results. If DLQ’s operations are found to violate any applicable law or other governmental regulations, DLQ
might be subject to civil and criminal penalties, damages, and fines. Any action against DLQ for violation of these laws, even if DLQ
successfully defends against it, could cause DLQ to incur significant legal expenses, divert their management’s attention from the
operation of its business, and damage DLQ’s reputation.
Current and future litigation against DLQ,
which may arise in the ordinary course of business, could be costly and time consuming to defend.
DLQ is subject to claims that
arise in the ordinary course of business, such as claims brought by their customers in connection with commercial disputes and employment
claims made by their current or former employees. Third parties may in the future assert intellectual property rights to technologies
that are important to their business and demand back royalties or demand that DLQ license their technology. Litigation may result in substantial
costs and may divert management’s attention and resources, which may seriously harm their business, overall financial condition,
and operating results. Insurance may not cover such claims, may not be sufficient for one or more such claims, and may not continue to
be available on terms acceptable to DLQ. A claim brought against DLQ that is uninsured or underinsured could result in unanticipated
costs, negatively affecting their business, results of operations, and financial condition.
DLQ could incur substantial costs resulting
from product liability claims relating to their products or services or their customers’ use of their products or services.
Any failure or errors caused
by DLQ’s products or services could result in a claim for substantial damages against them by their customers, regardless of their
responsibility for the failure. Although DLQ is generally entitled to indemnification under its customer contracts against claims brought
against them by third parties arising out of their customers’ use of their products, DLQ might find themselves entangled in lawsuits
against them, even if unsuccessful, may divert their resources and energy and adversely affect their business. Further, in the event DLQ
seeks indemnification from a customer, a court may not enforce the indemnification right if the customer challenges it or the customer
may not be able to fund any amounts for indemnification owed to DLQ. In addition, DLQ’s existing insurance coverage may not
continue to be available on reasonable terms or may not be available in amounts sufficient to cover one or more large claims, or the insurer
may disclaim coverage as to any future claim.
Cybersecurity and data privacy incidents
or breaches may damage client relations and inhibit DLQ’s growth.
The confidentiality and security
of DLQ’s information, and that of third parties, is critical to DLQ’s business. DLQ’s services involve the transmission,
use, and storage of customers’ and their customers’ information, which may be confidential or contain personally identifiable
information. Any cybersecurity or data privacy incidents could have a material adverse effect on DLQ’s results of operations and
financial condition. While DLQ maintains a broad array of information security and privacy measures, policies and practices, its networks
may be breached through a variety of means, resulting in someone obtaining unauthorized access to DLQ’s information, to information
of DLQ’s customers or their customers, or to DLQ’s intellectual property; disabling or degrading service; or sabotaging systems
or information. In addition, hardware, software, or systems, DLQ develops or procure from third parties may contain defects in design
or manufacture or other problems that could unexpectedly compromise information security. Unauthorized parties may also attempt to gain
access to DLQ’s systems or facilities, or those of third parties with whom DLQ does business, through fraud or other forms of deceiving
DLQ’s employees, contractors, and vendors. Because the techniques used to obtain unauthorized access, or to sabotage systems, change
frequently and generally are not recognized until launched against a target, DLQ may be unable to anticipate these techniques or to implement
adequate preventative measures. DLQ will continue to incur significant costs to continuously enhance its information security measures
to defend against the threat of cybercrime. Any cybersecurity or data privacy incident or breach may result in:
| · | loss of revenue resulting from the operational disruption; |
| · | loss of revenue or increased bad debt expense due to the inability
to invoice properly or to customer dissatisfaction resulting in collection issues; |
| · | loss of revenue due to loss of customers; |
| · | material remediation costs to recreate or restore systems; |
| · | material investments in new or enhanced systems in order to
enhance DLQ’s information security posture; |
| · | cost of incentives offered to customers to restore confidence
and maintain business relationships; |
| · | reputational damage resulting in the failure to retain or attract
customers; |
| · | costs associated with potential litigation or governmental investigations; |
| · | costs associated with any required notices of a data breach; |
| · | costs associated with the potential loss of critical business
data; |
| · | difficulties enhancing or creating new products due to loss
of data or data integrity issues; and |
| · | other consequences of which DLQ is not currently aware but would
discover through the process of remediating any cybersecurity or data privacy incidents or breaches that may occur. |
DLQ may face additional costs, loss of revenue,
significant liabilities, harm to its brand, decreased use of its products or services and business disruption if there are any security
or data privacy breaches or other unauthorized or improper access.
DLQ has access to and utilizes
personal data, such as names, mailing addresses, email addresses, mobile phone numbers, location information and other consumer information
used for marketing purposes. Any failure to prevent or mitigate security breaches or improper access to, use, disclosure or other misappropriation
of its data or consumers’ personal data could result in significant liability under state, (e.g., state breach notification and
privacy laws such as the CCPA) federal and laws in other jurisdictions. Such an incident may also cause a material loss of revenue from
the potential adverse impact to DLQ’s reputation and brand, affect its ability to retain or attract new users of our products and
services and potentially disrupt its business.
Unauthorized disclosure of
sensitive or confidential data, including personally identifiable information, whether through a breach of computer systems, systems failure,
employee negligence, fraud or misappropriation, or otherwise, or unauthorized access to or through DLQ’s information systems and
networks, whether by its employees or third parties, could result in negative publicity, legal liability and damage to its reputation.
Unauthorized disclosure of personally identifiable information could also expose DLQ to sanctions for violations of data privacy laws
and regulations around the world. To the extent that any disruption or security breach resulted in a loss of or damage to our data or
applications, or inappropriate disclosure of confidential or proprietary information, DLQ could incur liability. For example, the loss
of or client data could result in delays of the performance of our services and negatively impact our reputation, revenues and in some
instances create liability.
As DLQ becomes more dependent
on information technologies to conduct our operations, cyber incidents, including deliberate attacks and attempts to gain unauthorized
access to computer systems and networks, may increase in frequency and sophistication. These threats pose a risk to the security of DLQ’s
systems and networks, the confidentiality and the availability and integrity of its data and these risks apply both to DLQ, and to third
parties on whose systems it relies upon for the conduct of its business. Because the techniques used to obtain unauthorized access, disable
or degrade service or sabotage systems change frequently and often are not recognized until launched against a target, DLQ and its partners
may be unable to anticipate these techniques or to implement adequate preventative measures. may in the future, experience security incidents.
DLQ cannot predict the impact of any such future events. Further, DLQ does not have any control over the operations of the facilities
or technology of its cloud and service providers, including any third-party vendors that collect, process and store personal data on its
behalf. DLQ’s systems, servers and platforms and those of its service providers may be vulnerable to computer viruses or physical
or electronic break-ins that our or their security measures may not detect. Individuals able to circumvent such security measures may
misappropriate DLQ’s confidential or proprietary information, disrupt its operations, damage its computers or otherwise impair its
reputation and business. DLQ may need to expend significant resources and make significant capital investments to protect against security
breaches or to mitigate the impact of any such breaches. In addition, to the extent that its cloud and other service providers, experience
security breaches that result in the unauthorized or improper use of confidential data, employee data or personal data, DLQ may not be
indemnified for any losses resulting from such breaches. There can be no assurance that DLQ or its third-party providers will be successful
in preventing cyber-attacks or successfully mitigating their effects.
Recent cyber-attacks purportedly
originated by Russian controlled entities have exacerbated in the wake of Russia’s invasion of Ukraine and our systems may be infiltrated
by foreign actors. If DLQ is unable to prevent or mitigate the impact of such security breaches, our ability to attract and retain new
customers, other partners could be harmed as they may be reluctant to entrust their data to DLQ, and DLQ could be exposed to litigation
and governmental investigations, which could lead to a potential disruption to its business or other adverse consequences.
DLQ’s use, disclosure and other processing
of personally identifiable information is subject to US federal, state, and foreign privacy and security regulations, and its failure
to comply with those regulations or to adequately secure the information it holds could result in significant liability or reputational
harm and, in turn, a material adverse effect on DLQ’s business, operating results and prospects.
DLQ maintains and its third-party
vendors, collaborators, contractors and consultants maintain and process on its behalf, sensitive information, including confidential
business, personal and other information, and are subject to data privacy and protection laws and regulations that apply to the collection,
transmission, storage and use of personally identifying information, which among other things, impose certain requirements relating to
the privacy, security and transmission of personal information. Failure by DLQ or their third-party vendors, collaborators, contractors
and consultants to comply with any of these laws and regulations could result in notification obligations or enforcement actions against
them, which could result in fines, imprisonment of company officials and public censure, claims for damages by affected individuals, damage
to reputation and loss of goodwill, any of which could have a material adverse effect on DLQ’s business, financial condition, results
of operations or prospects. These laws, rules and regulations evolve frequently and their scope may continually change, through new legislation,
amendments to existing legislation and changes in enforcement, and may be inconsistent from one jurisdiction to another. In the US, numerous
federal and state laws and regulations, including federal health information privacy laws, state data breach notification laws, state
health information privacy laws and federal and state consumer protection laws (e.g., Section 5 of the Federal Trade Commission Act),
that govern the collection, use, disclosure and protection of personal information could apply to DLQ’s operations.
Many state legislatures have
adopted legislation relating to privacy, data security and data breaches. Laws in all 50 states require businesses to provide notice to
customers whose personally identifiable information has been disclosed as a result of a data breach. The laws are not consistent, and
compliance in the event of a widespread data breach is costly. States are also frequently amending existing laws, requiring attention
to frequently changing regulatory requirements. For example, California recently enacted the CCPA, which became effective on January 1,
2020. The CCPA, among other things, requires new disclosures to California consumers and affords such consumers new abilities to access
and delete their personal information, opt-out of certain sales of personal information and receive detailed information about how their
personal information is used. The CCPA provides for fines of up to $7,500 per violation, as well as a private right of action for data
breaches that is expected to increase the frequency of data breach litigation. While the CCPA has already been amended multiple times,
it is unclear how this legislation will be further modified or how it will be interpreted. Interpretations of the CCPA may continue to
evolve with regulatory guidance and the CCPA continue to be amended, including through a ballot initiative, the CPRA. That passed
in November 2020. The CPRA will impose additional data protection obligations on companies doing business in California, including
additional consumer rights, including regarding certain uses of sensitive data. It also creates a new California data protection agency
specifically tasked to enforce the law, which may likely result in increased regulatory scrutiny of California businesses in the areas
of data protection and security. The effects of this legislation potentially are far-reaching, however, and may require us to modify our
data processing practices and policies and incur substantial compliance-related costs and expenses. The CCPA and other changes in state
and federal laws or regulations relating to privacy, data protection and information security, particularly any new or modified laws or
regulations that require enhanced protection of certain types of data or new obligations with regard to data retention, transfer or disclosure,
could increase the cost of providing our offerings, require significant changes to our operations or even prevent us from providing certain
offerings in jurisdictions in which DLQ currently operates and in which it may operate in the future.
Because of the breadth of
these data protection laws and the narrowness of their exceptions and safe harbors, it is possible that DLQ’s business or data protection
policies could be subject to challenge under one or more of such laws. The scope and enforcement of each of these laws is uncertain and
subject to rapid change in the current environment of heightened regulatory focus on data privacy and security issues. Although DLQ endeavors
to comply with our published policies and documentation and ensure their compliance with current laws, rules and regulations, DLQ may
at times fail to do so or be alleged to have failed to do so. The publication of its privacy policy and other documentation that provide
promises and assurances about privacy and security can subject DLQ to potential state and federal action in the United States if
they are found to be deceptive, unfair, or misrepresentative of our actual practices. Any failure by DLQ or other parties with whom it
does business to comply with this documentation or with federal, state, local or international regulations could result in proceedings
against us by governmental entities, private parties or others. In many jurisdictions, enforcement actions and consequences for noncompliance
are rising.
If DLQ’s operations
are found to be in violation of any of the data protection laws described above or any other laws that apply to them, they may be subject
to penalties, including, but not limited to, criminal, civil and administrative penalties, damages, fines, disgorgement, individual imprisonment,
possible exclusion from participation in government healthcare programs, injunctions, private qui tam actions brought by individual whistleblowers
in the name of the government, class action litigation and the curtailment or restructuring of DLQ’s operations, as well as additional
reporting obligations and oversight if they become subject to a corrective action plan or other agreement to resolve allegations of non-compliance
with these laws, any of which could adversely affect their ability to operate our business and our results of operations. Complying with
these various laws and regulations could cause us to incur substantial costs or require us to change our business practices, systems and
compliance procedures in a manner adverse to DLQ business.
DLQ may eventually operate
in a number of countries outside of the United States whose laws, including data privacy laws, may in some cases be more stringent
than the requirements in the United States. For example, EU and UK data privacy laws have specific requirements relating to cross-border
transfers of personal data to certain jurisdictions, including to the United States, have strict requirements relating to personal
data collection, use or sharing, and have more stringent requirements relating to organizations’ privacy programs and provide stronger
individual rights. Moreover, DLQ may also be subject to evolving international privacy and data security regulations which could result
in greater compliance costs and in turn lead to penalties, where such compliance programs are not implemented correctly.
Risks Related To Intellectual Property
DLQ may be unable to adequately enforce
or defend their ownership and use of DLQ’s intellectual property and other proprietary rights.
Part of DLQ’s success
is dependent upon their intellectual property and other proprietary rights. DLQ relies upon a combination of trademark, trade secret,
copyright, unpatented know-how, and unfair competition laws, as well as license and access agreements and other contractual provisions,
to protect their intellectual property and other proprietary rights. In addition, DLQ attempts to protect its intellectual property and
proprietary information by requiring certain of its employees and consultants to enter into confidentiality, non-competition, and assignment-of-inventions
agreements. Policing unauthorized use of DLQ products and services is difficult and they may not be able to protect our technology from
unauthorized use. Further, the steps DLQ takes to protect its rights may not be adequate under the laws of some foreign countries, which
may not protect intellectual property rights to the same extent as do the laws of the United States. DLQ’s attempts to protect
its intellectual property may be challenged by others or invalidated through administrative process or litigation, and agreement terms
that address non-competition are difficult to enforce in many jurisdictions and may not be enforceable in any particular case. In addition,
there remains the possibility that others will “reverse engineer” DLQ’s products or services in order to introduce competing
products or services, or that others will develop competing technology independently and that do not infringe DLQ rights. In these cases,
they may be unable to prevent such competitors from selling or licensing these similar or superior technologies. If DLQ resorts to legal
proceedings to enforce its intellectual property rights or to determine the validity or scope of DLQ’s intellectual property or
other proprietary rights, the proceedings could be burdensome, expensive and distracting of management, even if they were to prevail.
The failure to adequately protect DLQ’s intellectual property and other proprietary rights may have a material adverse effect on
DLQ’s business, results of operations or financial condition.
DLQ relies on third-party providers to license
certain intellectual property and to provide internet services, and any failure by these third-party providers to continue to license
any intellectual property or to provide reliable services could cause DLQ to lose customers and subject it to claims for credits or damages,
among other things.
DLQ relies on services from
third-party intellectual property providers in order to provide services to its customers and their customers. In addition, DLQ depends
on its internet bandwidth suppliers to provide uninterrupted and error-free service through their networks. DLQ exercises little
control over these third-party providers, which increases its vulnerability to problems with the services they provide.
When problems occur, it may
be difficult to identify the source of the problem. Service disruption or outages, whether caused by DLQ’s service, the products
or services of DLQ’s third-party service providers, or DLQ’s customers’ or their customers’ equipment and
systems, may result in loss of market acceptance of its products and technologies and any necessary remedial actions may force it to incur
significant costs and expenses.
If any of these service providers
fail to provide reliable services, suffer outages, degrade, disrupt, increase the cost of or terminate the services that DLQ and its customers
depend on, DLQ may be required to switch to another service provider. Delays caused by switching to another service provider, if available,
and qualifying this new service provider could materially harm its operating results. Further, if any licenses cannot be renewed on commercially
favorable terms, and any failure on the part of third-party service providers to achieve or maintain expected performance levels,
stability and security could harm DLQ’s relationships with its customers, cause it to lose customers, result in claims for credits
or damages, increase its costs or the costs incurred by its customers, damage its reputation, significantly reduce customer demand for
its products and technologies and seriously harm its operating results.
If DLQ is unable to transfer existing customers
or acquire new customers, its operating results will be harmed. Likewise, potential customer turnover in the future, or costs it incurs
to retain its existing customers, could materially and adversely affect its operating results.
DLQ’s success depends
on its ability to maintain existing customers and to acquire new customers in new and existing verticals, and in new and existing markets.
If DLQ is unable to transfer existing customers or attract a sufficient number of new customers, it may be unable to reduce gross margins
at desired rates and its operating results may suffer. The software service market is competitive and many of DLQ’s competitors
have substantial financial, personnel and other resources that they utilize to develop solutions and attract customers. As a result, it
may be difficult for us to maintain existing customers or add new customers to DLQ’s existing customer base. Competition in the
marketplace may also lead us to win fewer new customers or result in us providing discounts and other commercial incentives. Additional
factors that impact DLQ’s ability to acquire new customers include the perceived need for marketing products or services,
the size of prospective customers’ budgets for these products and services, the utility and efficacy of DLQ’s existing platform
and new products, whether proven or perceived, and general economic conditions. These factors may have a meaningful negative impact on
operating results.
DLQ’s use of open source technology
could impose limitations on its ability to commercialize its software.
DLQ uses open source technology
in some of its software and expect to continue to use open source technology in the future. Although it monitors its use of open source
technology to avoid subjecting its software to conditions DLQ does not intend, DLQ may face allegations from others alleging ownership
of, or seeking to enforce the terms of, an open source license, including demands for the release of the open source software, derivative
works, or DLQ’s proprietary source code that was developed using such technology. These allegations could also result in litigation.
The terms of many open source licenses have not been interpreted by United States courts. There is a risk that these licenses could
be construed in a way that could impose unanticipated conditions or restrictions on DLQ’s ability to commercialize its software.
In such an event, DLQ may be required to seek licenses from third parties to continue commercially offering its software, to make its
proprietary code generally available in source code form, to re-engineer software or to discontinue the sale of its software if re-engineering
could not be accomplished on a timely basis, any of which could adversely affect DLQ’s business and revenue.
The use of open source technology
could subject DLQ to a number of other risks and challenges. Certain open source technology is subject to further development or modification
by anyone. Others may develop such software to be competitive with or no longer useful by us. It is also possible for competitors to develop
their own solutions using open source software, potentially reducing the demand for DLQ’s software. If DLQ is unable to successfully
address these challenges, its operating results may be adversely affected, and its development costs may increase.
Claims by others that DLQ infringes their
intellectual property or trade secret rights could harm their business.
DLQ’s industry is characterized
by vigorous protection and pursuit of intellectual property rights, which has resulted in protracted and expensive litigation for many
companies. Third parties may in the future assert claims of infringement of intellectual property rights against DLQ or against their
customers or channel partners for which DLQ may be liable. As the number of products and competitors in DLQ’s market increases and
overlaps occur, infringement claims may increase.
Intellectual property or trade
secret claims against DLQ, and any resulting lawsuits, may result in DLQ incurring significant expenses and could subject us to significant
liability for damages. DLQ’s involvement in any patent dispute, copyright dispute or other intellectual property dispute or action
regarding trade secret or know-how misappropriation could have a material adverse effect on our business. Adverse determinations in any
litigation could subject DLQ to significant liabilities to third parties, require DLQ to seek licenses from third parties and prevent
us from developing and selling DLQ products or services. Any of these situations could have a material adverse effect on our business.
These claims, regardless of their merits or outcome, would likely be time consuming and expensive to resolve and could divert management’s
time and attention.
DLQ’s software products may have bugs,
which could result in delayed or lost revenue, expensive correction, liability to its customers and claims against us.
Complex software products
and services such as DLQ’s may contain errors, defects or bugs. Defects in the solutions, products or services that they develop
and sell to its customers could require expensive corrections and result in delayed or lost revenue, adverse customer reaction and negative
publicity about us or DLQ’s products, services and technologies. Customers who are not satisfied with any of DLQ’s products
or services may also bring claims against us for damages, which, even if unsuccessful, would likely be time-consuming to defend, and could
result in costly litigation and payment of damages. Such claims could harm DLQ’s reputation, financial results and competitive position.
DLQ may be unable to respond quickly enough
to changes in technology and technological risks and to develop its intellectual property into commercially viable products and services.
Changes in legislative, regulatory
or industry requirements or in competitive technologies may render certain of DLQ’s products or services obsolete or less attractive
to its customers, which could adversely affect its results of operations. DLQ’s ability to anticipate changes in technology and
regulatory standards and to successfully develop and introduce new and enhanced products and services on a timely basis will be a significant
factor in its ability to be competitive. There is a risk that DLQ will not be able to achieve the technological advances that may be necessary
for us to be competitive or that certain of its products or services will become obsolete. DLQ is also subject to the risks generally
associated with new product and service introductions, including lack of market acceptance, delays in product/service development and
failure of products and services to operate properly. These risks could have a material adverse effect on DLQ’s business, results
of operations and financial condition.
Risks Related To DLQ Becoming A Subsidiary
Of A NASDAQ Listed Company After The Business Combination
Industry data, projections and estimates
relied upon by DLQ are inherently uncertain, subject to interpretation and may not have been independently verified.
Information concerning DLQ’s
industry and the markets in which DLQ intends to operate is obtained from independent industry and research organizations and other third-party sources.
Industry projections and estimates are derived from publicly available information released by independent industry analysts and third-party sources.
DLQ has not independently verified any such third-party information. In addition, projections, assumptions and estimates of the future
performance of the industry in which DLQ operates are subject to uncertainty and risk due to a variety of factors. As a result, inaccuracies
in third-party information or in the projects may lead to adverse impact on assumptions that are relied upon for internal business
planning and analysis purposes.
DLQ has not yet developed its environmental,
social and governance (ESG) program. DLQ may be required by law, regulations or listing rules to implement an ESG program and its failure
to do so may adversely impact its operations and reputation.
The growing integration of
Environmental, Social and Governance (“ESG”) factors in making investment decisions is relatively new and frameworks
and methods used by investors for assessing ESG policies are not fully developed and vary considerably among the investment community.
DLQ has not yet developed its ESG program, including its diversity and inclusion program. DLQ may be required by law and regulations to
implement an ESG program. In particular, the SEC is considering implementing mandatory reporting rules regarding disclosure of climate
related risks. Nasdaq is implementing diversity and inclusion reporting rules as well as requirements for its listed companies to meet
certain diversity targets. Any failure to implement an ESG program and comply with ESG disclosure requirements may adversely impact DLQ’s
business and reputation as well as financial condition. There may be a perception held by the general public, DLQ’s customers, investors,
service providers or counterparties that DLQ’s policies and procedures are insufficient.
DLQ’s reputation could
also be harmed if it fails to act responsibly in the ESG areas in which it chooses or is required to report apart from legal or regulatory
requirements. Any harm to DLQ’s reputation resulting from setting these standards or its failure or perceived failure to set or
meet such standards could impact employee retention; the willingness of DLQ’s customers to use its product and services, service
providers or counterparties to do business with it; investors’ willingness or ability to purchase or hold its securities; or DLQ’s
ability to access capital, any of which could adversely affect DLQ’s reputation, business, financial performance, and future prospects.
Risks Related to DLQ’s Personnel
DLQ depends on talented, experienced and
committed personnel to operate and grow DLQ’s business and may incur increased operational costs to recruit, train, motivate and/or
retain them. If DLQ is unable to do so, DLQ’s business, financial condition, results of operations and prospects may be adversely
affected.
DLQ believes that its future
success is highly dependent on the talents and contributions of DLQ’s employees. DLQ’s future success depends on its ability
to attract, develop, motivate and retain highly qualified and skilled employees. DLQ’s growth strategy is based, in part, on its
ability to attract and retain highly skilled employees experienced in the digital marketing industry. DLQ has and will continue to face
intense competition for qualified individuals from numerous software and other technology companies and has previously experienced attrition
in these areas. DLQ may incur increased operational costs to recruit, train, motivate and/or retain qualified and suitable personnel.
Even so, these measures may not be enough to attract and retain the personnel DLQ requires to operate its business effectively. DLQ may
face difficulties in recruiting and retaining professionals of a caliber consistent with its business strategy in the future. The loss
of even a few qualified employees or an inability to attract, retain and motivate additional highly skilled employees required for the
expansion of DLQ’s business could adversely impact its operating results and impair its ability to grow.
DLQ is dependent on key personnel and the
loss of one or more of its key personnel may result in adverse impact.
DLQ is currently highly dependent
on the services of Mr. Brent Suen, as sole director sole executive officer. Mr. Suen is responsible for executing DLQ’s
business operations at the executive level. If Mr. Suen were to discontinue his service due to death, disability or any other reason,
DLQ would be significantly disadvantaged. DLQ does not maintain, and does not expect to maintain in the future, a key person life insurance
policy with respect to Mr. Suen.
Misconduct, errors, mistakes and/or inappropriate
conduct (including breach of laws, regulations and internal policies) or public statements by DLQ’s personnel and/or service providers
and/or DLQ’s failure to appropriately respond to such conduct or situation, may result in legal liability for DLQ and adversely
impact DLQ’s business operations as well as reputation.
There is a risk that an employee
of, or service provider to, DLQ or any of its affiliates could engage in misconduct that adversely affects DLQ’s business. It is
not always possible to deter such misconduct and the precautions DLQ takes to detect and prevent such misconduct may not be effective
in all cases.
Employee or service provider
misconduct or error, including breach of laws, regulations and/or DLQ’s internal policies, could subject DLQ’s to legal liability,
financial losses and regulatory sanctions and could seriously harm DLQ’s reputation and negatively affect DLQ’s business.
Such misconduct could include breach of anti-bribery and corruption laws, engaging in improper or unauthorized transactions or activities,
misappropriation of customer information or data, insider trading and misappropriation and misuse of information (including material non-public information),
failing to supervise other employees or service providers, improperly using confidential information, as well as improper trading activity
such as spoofing, layering, wash trading, manipulation and front-running. Employee or service provider errors, including mistakes in executing,
recording or processing transactions for customers, could expose DLQ to the risk of material losses even if the errors are detected. Although
DLQ plans to implement processes and procedures and provide training to DLQ’s employees and service providers to reduce the likelihood
of misconduct and error, these efforts may not be successful.
Moreover, the risk of employee
or service provider error or misconduct may be even greater for novel products and services and is compounded by the fact that many of
DLQ’s employees and service providers are accustomed to working at digital marketing companies which generally do not maintain the
same compliance customs and rules. This can lead to high risk of confusion among employees and service providers, particularly in a growing
company like DLQ, with respect to compliance obligations, particularly including confidentiality, data access, trading and conflicts.
It is not always possible
to deter misconduct and the precautions DLQ takes to prevent and detect this activity may not be effective in all cases. If DLQ were found
to have not met its regulatory oversight and compliance and other obligations, DLQ could be subject to regulatory sanctions, financial
penalties and restrictions on DLQ’s activities for failure to properly identify, monitor and respond to potentially problematic
activity and seriously damage DLQ’s reputation. DLQ’s employees, contractors and agents could also commit errors that subject
DLQ to financial claims for negligence as well as regulatory actions or result in financial liability. Further, allegations by regulatory
or criminal authorities of improper trading activities could affect DLQ’s brand and reputation. DLQ’s failure to appropriately
respond to such conduct or situation can also adversely impact DLQ’s business operations as well as reputation.
DLQ’s personnel or service
providers may also make inappropriate or harmful public statements in their own capacity that are not authorized by DLQ, including posting
on social media platforms. By virtue of their association with DLQ, the public may react negatively against DLQ. Such unauthorized
public statements may damage DLQ’s brand, reputation and public perception and adversely impact DLQ’s business, financial
condition and share price.
Risks Related to Abri’s Business and
the Business Combination
Going public through a merger rather than
an underwritten offering presents risks to unaffiliated investors. Subsequent to Closing, the Combined Company may be required to take
write-downs or write-offs, restructure its operations, or take impairment or other charges, any of which could have a significant negative
effect on the Combined Company’s financial condition, results of operations and share price, which could cause you to lose some
or all of your investment.
Going through a merger rather
than an underwritten offering as DLQ is seeking to do through the Business Combination, presents risks to unaffiliated investors. Such
risks include the absence of a due diligence investigation conducted by an underwriter that would be subject to liability for any material
misstatements or omissions in a registration statement. Although Abri has conducted due diligence on DLQ, Abri cannot assure you that
this due diligence has identified all material issues that may be present in DLQ, that it would be possible to uncover all material issues
through a customary amount of due diligence, or that factors outside of DLQ’s business or Abri’s business and outside of DLQ’s
and Abri’s control will not later arise. Due diligence reviews in a typical IPO may include an independent investigation of the
background of the company, any advisors and their respective affiliates, review of the offering documents and independent analysis of
the business plan and any underlying financial assumptions. Because the Combined Company will become a public reporting company by means
of consummating the Business Combination rather than by means of a traditional underwritten initial public offering, there is no independent
third-party underwriter selling the shares of Common Stock of the Combined Company, and, accordingly, the Combined Company’s stockholders
(including the public stockholders) will not have the benefit of an independent review and due diligence investigation of the type normally
performed by an unaffiliated, independent underwriter in a public securities offering. As a result of these factors, the Combined Company
may be forced to later write-down or write-off assets, restructure operations, or incur impairments or other charges that could result
in reporting losses. Even if Abri’s due diligence successfully identifies certain risks, unexpected risks may arise and previously
known risks may materialize in a manner not consistent with Abri’s preliminary risk analysis. Even though these charges may be non-cash
items and not have an immediate impact on the Combined Company’s liquidity, the fact that the Abri reports charges of this nature
could contribute to negative market perceptions about the Combined Company or its securities. Accordingly, any of Abri’s stockholders
who choose to remain stockholders of the Combined Company could suffer a reduction in the value of their shares and these stockholders
are unlikely to have a remedy for the reduction in value.
Abri may not be able to complete an initial
business combination with a U.S. target company if such initial business combination is subject to U.S. foreign investment regulations
and review by a U.S. government entity such as the Committee on Foreign Investment in the United States (CFIUS), or ultimately
prohibited.
Abri’s Sponsor, Abri
Ventures I, LLC is controlled by Jeffrey Tirman, a Swiss citizen, and Abri’s Chief Executive Officer. Mr. Tirman will
not remain with the Combined Company after the Proposed Business Combination. We therefore do not expect the post-combination company
to be considered a “foreign person” under the regulations administered by CFIUS. However, if Abri’s initial business
combination with a U.S. business is subject to CFIUS review, the scope of which was expanded by the Foreign Investment Risk Review
Modernization Act of 2018 (“FIRRMA”), to include certain non-passive, non-controlling investments
in sensitive U.S. businesses and certain acquisitions of real estate even with no underlying U.S. business, this could delay
Abri in consummating a business combination. FIRRMA, and subsequent implementing regulations that are now in force, also subjects certain
categories of investments to mandatory filings. If Abri’s potential initial business combination with a U.S. business falls
within CFIUS’s jurisdiction, Abri may determine that they are required to make a mandatory filing or that they will submit a voluntary
notice to CFIUS, or to proceed with the initial business combination without notifying CFIUS and risk CFIUS intervention, before or after
closing the initial business combination. CFIUS may decide to block or delay the initial business combination, impose conditions to mitigate
national security concerns with respect to such initial business combination or order Abri or us to divest all or a portion of a U.S. business
of the Combined Company without first obtaining CFIUS clearance, which may limit the attractiveness of or prevent Abri from pursuing certain
initial business combination opportunities that they believe would otherwise be beneficial to them and their stockholders. As a result,
the pool of potential targets with which Abri could complete an initial business combination may be limited and they may be adversely
affected in terms of competing with other special purpose acquisition companies which do not have similar foreign ownership issues.
Moreover, the process of government
review, whether by the CFIUS or otherwise, could be lengthy and Abri has limited time to complete the initial business combination. If
Abri cannot complete an initial business combination by February 12, 2024, due to the passage of time relating to any governmental review,
or because any such review process drags on beyond such timeframe, or because Abri’s initial business combination is ultimately
prohibited by CFIUS or another U.S. government entity, Abri may be required to liquidate. In such situation, Abri would (i) cease all
operations except for the purpose of winding up and (ii) as promptly as reasonably possible but not more than ten business days thereafter,
redeem 100% of the outstanding shares of Abri Common Stock, at a per-share of Abri Common Stock price, payable in cash, equal to the aggregate
amount then on deposit in the Trust Account, including any interest not previously released to Abri (net of taxes payable), divided by
the number of then outstanding shares of Abri Common Stock, which redemption will completely extinguish public stockholders’ rights
as holders of shares of Abri Common Stock (including the right to receive further liquidation distributions, if any), subject to applicable
law.
Because the Combined Company will become
a public reporting company by means other than a traditional underwritten initial public offering, the Combined Company’s stockholders
may face additional risks and uncertainties.
Because the Combined Company
will become a public reporting company by means of consummating the Business Combination rather than by means of a traditional underwritten
initial public offering, there is no independent third-party underwriter selling the shares of the Combined Company’s Common Stock,
and, accordingly, the Combined Company’s stockholders will not have the benefit of an independent review and investigation of the
type normally performed by an unaffiliated, independent underwriter in a public securities offering. Due diligence reviews typically include
an independent investigation of the background of the company, any advisors and their respective affiliates, review of the offering documents
and independent analysis of the plan of business and any underlying financial assumptions. Because there is no independent third-party
underwriter selling the shares of the Combined Company’s Common Stock, Abri’s stockholders must rely on the information included
in this proxy statement. Although Abri performed a due diligence review and investigation of DLQ in connection with the Business Combination,
the lack of an independent due diligence review and investigation increases the risk of investment in the Combined Company because it
may not have uncovered facts that would be important to a potential investor.
In addition, because the Combined
Company will not become a public reporting company by means of a traditional underwritten initial public offering, security or industry
analysts may not provide, or be less likely to provide, coverage of the Combined Company. Investment banks may also be less likely to
agree to underwrite secondary offerings on behalf of the Combined Company than they might if the Combined Company became a public reporting
company by means of a traditional underwritten initial public offering, because they may be less familiar with the Combined Company as
a result of more limited coverage by analysts and the media. The failure to receive research coverage or support in the market for the
Combined Company’s Common Stock could have an adverse effect on the Combined Company’s ability to develop a liquid market
for the Combined Company’s Common Stock.
Abri has different incentives
and objectives in the Business Combination than an underwriter would in a traditional initial public offering, and therefore Abri’s
due diligence review and investigation should not be viewed as equivalent to the review and investigation that an underwriter would be
expected to conduct. Even if Abri’s due diligence successfully identifies certain risks, unexpected risks may arise and previously
known risks may materialize in a manner not consistent with Abri’s preliminary risk analysis. Even though these charges may be non-cash
items and not have an immediate impact on the Combined Company’s liquidity, the fact that Abri report charges of this nature could
contribute to negative market perceptions about the Combined Company or its securities. In addition, charges of this nature may cause
us to violate net worth or other covenants to which they may be subject as a result of assuming pre-existing debt held by a target business
or by virtue of Abri obtaining debt financing thereafter. Accordingly, any Abri stockholders or warrant holders who choose to remain stockholders
or warrant holders following the business combination could suffer a reduction in the value of their securities. These stockholders or
warrant holders are unlikely to have a remedy for the reduction in value.
Abri will be a “controlled company”
and the Combined Company may rely on exemptions from certain corporate governance requirements that provide greater protection to stockholders
of other companies.
Upon Closing, DLQ Parent will
beneficially own 43.6% of the Abri Common Stock with a substantial majority of voting power, without taking into account the redemption
of any additional shares of Abri Common Stock by the public stockholders or the issuance of any Earnout Shares, which include up to 1,000,000
Earnout Shares to be distributed to the Sponsor and up to 2,000,000 Earnout Shares to be distributed to DLQ Management, if certain milestones
are achieved after the business combination. Brent Suen, who is anticipated to be the Combined Company’s Chief Executive Officer,
is expected to continue holding the voting power with respect to all of the shares of DLQ Parent and may be deemed to have beneficial
ownership of the securities held of record after Closing and therefore will control the Combined Company. For more information, see “Security
Ownership of Certain Beneficial Owners and Management.” As a result, Abri will be a “controlled company” within the
meaning of the Nasdaq listing rules. Under these rules, a listed company of which more than 50% of the voting power is held by an individual,
group or another company is a “controlled company” and may elect to not comply with certain corporate governance requirements,
including the requirement that a majority of the board of directors consist of independent directors, the requirement that the nominating
committee is composed entirely of independent directors and the requirement that the compensation committee is composed entirely of independent
directors. As a result of DLQ Parent’s “controlled company” status, and if the Combined Company elects to rely on the
exemptions afforded to it as a “controlled company,” stockholders may be afforded less protection under the Nasdaq listing
rules and SEC regulations than other public companies.
Members of the Abri management team may
be deemed to have conflicts of interest in determining which entities should be presented as a potential business combination opportunity.
Members of the management
team may have affiliations with companies, including companies that are engaged in business activities similar to those intended to be
conducted. Accordingly, they may participate in transactions and have obligations that may be in conflict or competition with Abri’s
consummation of the initial business combination. In addition, Abri’s Current Charter provides 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 which may arise
from multiple affiliations, Abri’s officers and directors (other than Abri’s independent directors) agreed to present to Abri
for its consideration, prior to presentation to any other person or entity, any suitable opportunity to acquire a target business, until
the earlier of: (1) the consummation of an initial business combination and (2) 12 months from the closing of the IPO, (unless Abri extends
the time to complete the Business Combination for an additional one-month period until August 12, 2023). On August 5, 2022, Abri deposited
$573,392 into the Trust Account to extend the time to complete a Business Combination until November 12, 2022. On November 1, 2022, Abri
deposited $573,392 into the Trust Account for the second of two three-month extensions to extend the time to complete a Business Combination
until February 12, 2023. On February 6, 2023, March 10, 2023, April 11, 2023, May 11, 2023, June 9, 2023 and July 10, 2023, Abri deposited
$87,500 into the Trust Account for each one-month extension (or a total of $525,000) to extend the time to complete a business combination
to August 12, 2023. This agreement is, however, subject to any pre-existing fiduciary and contractual obligations such officer or director
may have to another entity. Abri does not believe that the pre-existing fiduciary duties or contractual obligations of its officers and
directors have impacted its ability to complete its business combination. On August 7, 2023, the Abri stockholders approved a proposal
to extend the time to complete a business combination to February 12, 2024.
Furthermore, Abri’s
Amended Charter renounces any interest or expectancy of the Combined Company in, or in being offered an opportunity to participate in,
any Excluded Opportunity. An “Excluded Opportunity” is any matter, transaction or interest that is presented to, or acquired,
created or developed by, or which otherwise comes into the possession of, any director of the Combined Company who is not an employee
or officer of the Combined Company or any of its subsidiaries (a “Covered Person”), unless such matter, transaction
or interest is presented to, or acquired, created or developed by, or otherwise comes into the possession of, a Covered Person expressly
and solely in such Covered Person’s capacity as a director of the Corporation.
Delaware law and the Combined Company’s
Amended Charter and Bylaws will contain certain provisions, including anti-takeover provisions that limit the ability of stockholders
to take certain actions and could delay or discourage takeover attempts that stockholders may consider favorable.
The Combined Company will
opt out of Section 203 of the DGCL. However, the proposed Amended Charter contains provisions that may discourage an attempt to obtain
control of us by means of a proxy contest, tender offer, merger or otherwise. These include: a staggered board of directors, making it
more difficult to gain control of the Combined Company’s Board by having to successfully engage in a proxy contest at two or more
annual meetings; a special meeting of stockholders may be called only by a majority vote of the Board, by the president or by the chairman
or by the secretary at the request in writing of stockholders owning a majority of the issued and outstanding capital stock entitled to
vote; meetings have longer advance notice requirements for stockholder proposals and director nominations and certain requirements as
to the form and content of a stockholders’ meeting are limited which may preclude stockholders from bringing matters before the
annual meeting of stockholders or from making nominations for directors at the annual meeting of stockholders; and authorized but unissued
shares may be issued 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 Amended Charter and bylaws contain provisions that could have
the effect of rendering more difficult, delaying, or preventing an acquisition deemed undesirable by the Abri Board and therefore depress
the trading price of Abri’s Common Stock. In addition, stockholders will not be able to act by written consent, which will make
certain actions that require stockholder consent, more difficult. As a Delaware corporation, the Combined Company will generally be subject
to provisions of Delaware law, including the DGCL. These provisions and the fact that stockholders cannot act by written consent, could
also make it difficult for stockholders to take certain actions, including electing directors who are not nominated by the current members
of the board of directors or taking other corporate actions, including effecting changes in management. For more information on the anti-takeover
and other provisions in the Combined Company Amended Charter and the applicable provisions of Delaware law, see the section captioned
“Anti-takeover provisions” beginning on page 205. Such provisions, alone or together, could delay or prevent hostile takeovers
and changes in control or changes in the Combined Company’s board of directors or management.
Any provision of the Amended
Charter or bylaws or Delaware law that has the effect of delaying or preventing a change in control could limit the opportunity for stockholders
to receive a premium for their shares of the Company’s capital stock and could also affect the price that some investors are willing
to pay for Abri Common Stock.
The Amended Charter will provide that the
courts located in the State of Delaware will be the sole and exclusive forum for substantially all disputes between us and our stockholders,
which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers,
or employees.
The proposed Amended Charter
renounces any interest or expectancy of the Combined Company in, or in being offered an opportunity to participate in, any Excluded Opportunity.
An “Excluded Opportunity” is any matter, transaction or interest that is presented to, or acquired, created or developed by,
or which otherwise comes into the possession of, any director of the Combined Company who is not an employee or officer of the Combined
Company or any of its subsidiaries (a “Covered Person”), unless such matter, transaction or interest is presented
to, or acquired, created or developed by, or otherwise comes into the possession of, a Covered Person expressly and solely in such Covered
Person’s capacity as a director of the Combined Company. The doctrine of corporate opportunity generally provides that a corporate
fiduciary may not develop an opportunity using corporate resources, acquire an interest adverse to that of the corporation or acquire
property that is reasonably incident to the present or prospective business of the corporation or in which the corporation has a present
or expectancy interest, unless that opportunity is first presented to the corporation and the corporation chooses not to pursue that opportunity.
The doctrine of corporate opportunity is intended to preclude officers, directors or other fiduciaries from personally benefiting from
opportunities that belong to the corporation.
Therefore, except as provided
above, if the Amended Charter is approved, these Covered Persons (including Messrs. Suen and Andrews) will have no duty to communicate
or present corporate opportunities to us, will have the right to either hold any corporate opportunity for their (and their affiliates’)
own account and benefit or to recommend, assign or otherwise transfer such corporate opportunity to persons other than us, and will not
be prohibited from operating or investing in competing businesses. We therefore may find ourselves in competition with one or more of
these Covered Persons, and we may not have knowledge of, or be able to pursue, transactions that could potentially be beneficial to us.
Accordingly, we may lose a corporate opportunity or suffer competitive harm, which could negatively affect our business or prospects.
The Amended Charter Proposal provides that
certain transactions are not “corporate opportunities” and that the management or directors of the Combined Company, or any
of their representatives or affiliates are not subject to the doctrine of corporate opportunity.
The proposed Amended Charter
renounces any interest or expectancy of the Combined Company in, or in being offered an opportunity to participate in, any Excluded Opportunity.
An “Excluded Opportunity” is any matter, transaction or interest that is presented to, or acquired, created or developed by,
or which otherwise comes into the possession of, any director of the Combined Company who is not an employee or officer of the Combined
Company or any of its subsidiaries (a “Covered Person”), unless such matter, transaction or interest is presented
to, or acquired, created or developed by, or otherwise comes into the possession of, a Covered Person expressly and solely in such Covered
Person’s capacity as a director of the Combined Company. The doctrine of corporate opportunity generally provides that a corporate
fiduciary may not develop an opportunity using corporate resources, acquire an interest adverse to that of the corporation or acquire
property that is reasonably incident to the present or prospective business of the corporation or in which the corporation has a present
or expectancy interest, unless that opportunity is first presented to the corporation and the corporation chooses not to pursue that opportunity.
The doctrine of corporate opportunity is intended to preclude officers, directors or other fiduciaries from personally benefiting from
opportunities that belong to the corporation.
Therefore, except as provided
above, if the Amended Charter is approved, these Covered Persons (including Messrs. Suen and Andrews) will have no duty to communicate
or present corporate opportunities to us, will have the right to either hold any corporate opportunity for their (and their affiliates’)
own account and benefit or to recommend, assign or otherwise transfer such corporate opportunity to persons other than us, and will not
be prohibited from operating or investing in competing businesses. We therefore may find ourselves in competition with one or more of
these Covered Persons, and we may not have knowledge of, or be able to pursue, transactions that could potentially be beneficial to us.
Accordingly, we may lose a corporate opportunity or suffer competitive harm, which could negatively affect our business or prospects.
Failure to meet the initial listing requirements
of Nasdaq could result in a de-listing of Abri Common Stock and could affect our cash position following the Business Combination.
Abri
has applied to list the Combined Company securities on the Nasdaq Global Market, although there is no assurance that the application will
be approved, Abri believes that upon consummation of the Business Combination, it will satisfy all listing requirements for the Nasdaq
Global Market. In addition, the Business Combination is contingent on being listed on the Nasdaq Global or Capital Market. If the application
is not approved, without a waiver from DLQ, we will not consummate the Business Combination, Abri will be required to dissolve and liquidate
its trust account by returning the then remaining funds in such account to the public stockholders, and Abri’s common stock and
warrants will be worthless.
If the Combined Company is
not able to list its shares of Common Stock on Nasdaq Global Market, and we obtain a waiver to complete the Business Combination without
being listed on the Nasdaq Global or Capital Market, the Common Stock would likely then trade only in the over-the-counter market and
the market liquidity of shares could be adversely affected and their market price could decrease. If the Combined Company’s shares
of Common Stock were to trade on the over-the-counter market, selling the Combined Company’s shares of Common Stock could be more
difficult because smaller quantities of shares would likely be bought and sold, transactions could be delayed, and we could face significant
material adverse consequences, including: a limited availability of market quotations for our securities; reduced liquidity with respect
to our securities; a determination that our shares are a “penny stock,” which will require brokers trading in our securities
to adhere to more stringent rules, possibly resulting in a reduced level of trading activity in the secondary trading market for our securities;
a reduced amount of news and analyst coverage for the Combined Company; and a decreased ability to issue additional securities or obtain
additional financing in the future. These factors could result in lower prices and larger spreads in the bid and ask prices for the Combined
Company’s shares of Common Stock and would substantially impair our ability to raise additional funds and could result in a loss
of institutional investor interest and fewer development opportunities for the Combined Company.
If Abri is unable to maintain its listing
on Nasdaq, it could become more difficult to sell Abri or Combined Company Common Stock and Warrants in the public market.
Failure to meet the continued
listing requirements of Nasdaq could result in a de-listing of Abri Common Stock. If shares of Abri Common Stock are ultimately delisted
from Nasdaq, Abri Common Stock (and Combined Company Stock after Closing) would likely then trade only in the over-the-counter market
and the market liquidity of shares could be adversely affected and their market price could decrease. Shares of Abri Common Stock or Combined
Company Common Stock were to trade on the over-the-counter market, selling shares of Abri Common Stock or Combined Company Common Stock
could be more difficult because smaller quantities of shares would likely be bought and sold, transactions could be delayed,
and we could face significant material adverse consequences, including: a limited availability of market quotations for our securities;
reduced liquidity with respect to our securities; a determination that our shares are a “penny stock,” which will require
brokers trading in our securities to adhere to more stringent rules, possibly resulting in a reduced level of trading activity in the
secondary trading market for our securities; a reduced amount of news and analyst coverage for Abri or the Combined Company; and a decreased
ability to issue additional securities or obtain additional financing in the future. These factors could result in lower prices and larger
spreads in the bid and ask prices for Abri Common Stock or Combined Company Common Stock and would substantially impair Abri’s and/or
the Combined Company’s ability to raise additional funds and could result in a loss of institutional investor interest and fewer
development opportunities for Abri and/or the Combined Company.
A delisting from Nasdaq Capital
Market and failure to obtain listing on another market or exchange could impose additional sales practice and market-making requirements
on broker-dealers who sell or make a market in such securities. Consequently, removal from Nasdaq and failure to obtain listing on another
market or exchange could affect the ability or willingness of broker-dealers to sell or make a market in Combined Company Common Stock
and the ability of purchasers of Combined Company Common Stock to sell their securities in the secondary market. In addition, delisting
from Nasdaq Capital Market, and being unable to list on Nasdaq Global Market would prevent us from consummating the Business Combination
because, without a waiver from DLQ, being listed on either Nasdaq Global Market or Capital Markets is a condition to closing. If Abri
does not consummate the Business Combination, Abri will be required to dissolve and liquidate its trust account by returning the then
remaining funds in such account to the Abri public stockholders, and Abri common stock and warrants will be worthless.
Abri does not have a specified maximum redemption
threshold in the Current Charter. The absence of such a redemption threshold may make it impossible for Abri to consummate the Business
Combination, in connection with which a substantial majority of Abri’s public stockholders may redeem their Public Shares.
The Current Charter does not
provide a specified maximum redemption threshold, and Abri removed the requirement for Abri to maintain net tangible assets of at least
$5,000,001 upon consummation of the Business Combination (to which could subject us to the SEC’s “penny stock” rules).
However, Abri believes that it may rely on an exclusion, which relates to it being listed on the Nasdaq Capital Market (Rule 3a51-1(a)(2))
(the “Exchange Rule”). The Exchange Rule excludes from the definition of “penny stock” a security
that is registered, or approved for registration upon notice of issuance, on a national securities exchange, or is listed, or approved
for listing upon notice of issuance on, an automated quotation system sponsored by a registered national securities association, that
has established initial listing standards that meet or exceed the criteria set forth in the Exchange Rule. Abri’s securities are
currently listed on the Nasdaq Capital Market. In addition, Abri will be applying to list the Combined Company securities on Nasdaq Global
Market. The Company believes that upon consummation of the Business Combination, it will meet the initial listing standards that satisfy
the criteria identified in the Exchange Rule to avoid being treated as a penny stock issuer. With the Amendment to the Current Charter
to remove a redemption threshold, our public stockholders may redeem some or all of the remaining public shares for cash, leaving little
or no money left in the Trust Account, which may make it more difficult for us to consummate the Business Combination.
Abri is not an investment advisory client
of Chardan Capital Markets under the Investment Advisers Act, and Abri is not an investment company under the Investment Company Act.
Chardan Capital Markets does
not and will not provide any investment advice to Abri, and Abri is not an investment advisory client of Chardan Capital Markets under
the Investment Advisers Act of 1940 (the “Advisers Act”). Abri is not a fund or a company managed by Chardan Capital
Markets. This means that Abri is not entitled to the protections afforded to clients under the Advisers Act, and Chardan Capital Markets
owes no fiduciary duties to Abri under the Advisers Act. In particular, Chardan Capital Markets has no fiduciary or other duties to present
Abri with any prospective initial business combination opportunities or any information, investment strategies, opportunities or ideas
known to them or developed or used in connection with their other investment activities, and, in certain cases, may be prohibited from
doing so.
In addition, Abri is not an
investment company under the Investment Company Act, and Abri is not entitled to the protections afforded to investment companies under
that law.
Abri will be forced to liquidate the Trust Account
if it cannot consummate a business combination February 12, 2024). In the event of a liquidation, the public stockholders will receive
$10.68 per share of Common Stock and the Warrants will expire worthless.
If Abri is unable to complete
a business combination by February 12, 2024 and is forced to liquidate, the per-share liquidation distribution will be $10.68. Furthermore,
Abri public stockholders will forfeit the Warrant included in the shares of Common Stock being redeemed.
On December 9, 2022, Abri
held a special stockholder meeting to extend the time to complete a Business Combination up to August 12, 2023, on a month-to-month basis.
Abri stockholders approved an amendment to Abri’s amended and restated certificate of incorporation and an amendment to the Investment
Management Trust Agreement with Continental Stock Transfer & Trust Company, dated August 9, 2022, giving Abri the right to extend
the time to consummate the Business Combination six (6) times for an additional one (1) month each time by depositing into the Trust Account
$87,500 for each one-month extension, up to August 12, 2023 (which were already made).
On August 12, 2023, Abri held
a second special stockholder meeting to extend the time to complete a Business Combination up to February 12, 2024 with no additional
deposits to the Trust Account.
In connection with the Extension
Meeting and the Second Extension Meeting, a total 5,051,772 shares were tendered for redemption. Approximately $52 million was withdrawn
from Abri’s Trust Account to pay for the redemption, leaving approximately $7.2 million in the Trust Account as of August 9, 2023,
inclusive of the last two Extension Payments. As a result of the redemptions, we now have less liquidity and fewer round-lot holders of
our public shares, which may make it more difficult to meet Nasdaq listing requirements.
If third parties bring claims against Abri,
the proceeds held in trust could be reduced and the per share liquidation price received by holders of shares of Common Stock may be
less than $10.68.
Abri’s placing of funds
in trust may not protect those funds from third party claims against Abri. Although Abri has received from many of the vendors, service
providers (other than its independent accountants) and prospective target businesses with which it does business executed agreements waiving
any right, title, interest or claim of any kind in or to any monies held in the Trust Account for the benefit of the public stockholders,
they may still seek recourse against the Trust Account. Additionally, a court may not uphold the validity of such agreements. Accordingly,
the proceeds held in trust could be subject to claims which could take priority over those of the public stockholders. If Abri liquidates
the Trust Account before the completion of a business combination and distributes the proceeds held therein to the public stockholders,
the Sponsor has contractually agreed that it will be liable to ensure that the proceeds in the Trust Account are not reduced by the claims
of target businesses or claims of vendors or other entities that are owed money by us for services rendered or contracted for or products
sold to us, but only if such a vendor or prospective target business does not execute such a waiver. However, Abri cannot assure you that
they will be able to meet such obligation. Therefore, the per-share distribution from the Trust Account for our stockholders may be less
than $10.00 per share of Common Stock due to such claims.
Additionally, if Abri is forced
to file a bankruptcy case or an involuntary bankruptcy case is filed against it which is not dismissed, the proceeds held in the Trust
Account could be subject to applicable bankruptcy law, and may be included in Abri’s bankruptcy estate and subject to the claims
of third parties with priority over the claims of its stockholders. To the extent any bankruptcy claims deplete the Trust Account, Abri
may not be able to return $10.00 to our public stockholders.
Any distributions received by Abri stockholders
could be viewed as an unlawful payment if it was proved that immediately following the date on which the distribution was made, Abri was
unable to pay its debts as they became due in the ordinary course of business.
Abri’s Certificate of
Incorporation provides that it will continue in existence only until February 12, 2023 (unless we extend the time to complete the Business
Combination for an additional one-month period until August 12, 2023). On February 6, 2023, March 10, 2023, April 11, 2023, May 11, 2023,
June 9, 2023 and July 10, 2023, Abri deposited $87,500 into the Trust Account for each one-month extension (for a total of $525,000) to
extend the time to complete a business combination to August 12, 2023. . On August 7, 2023, at Abri’s Second Extension Meeting,
the stockholders approved a proposal to extend the date to complete a business combination to February 12, 2024 with no additional amounts
to be deposited into the Trust Account If Abri is unable to consummate a transaction within the required time periods, upon notice from
Abri, the trustee of the Trust Account will distribute the amount in its Trust Account to the Abri public stockholders. Concurrently,
Abri shall pay, or reserve for payment, from funds not held in trust, its liabilities and obligations, although Abri cannot ensure that
there will be sufficient funds for such purpose.
Abri expects 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 funds held outside the Trust Account, although Abri cannot assure you that there will be sufficient funds for such purpose. Abri
will depend on sufficient interest being earned on the proceeds held in the Trust Account to pay any tax obligations we may owe or for
working capital purposes. In connection with the Extension Meeting, a total 5,051,772 shares were tendered for redemption. Approximately
$$52 million was withdrawn from Abri’s trust account (the “Trust Account”) to pay for the redemption,
leaving approximately $7.2 million in the Trust Account as of August 9, 2023, inclusive of the last two Extension Payments. As a result
of the redemptions, Abri now has less liquidity.
Abri may not 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 well beyond the third anniversary of
the date of distribution. Accordingly, third parties may seek to recover from Abri stockholders amounts owed to them by Abri.
If, after Abri distributes
the remaining proceeds in the Trust Account to its public stockholders, Abri files a bankruptcy petition or an involuntary bankruptcy
petition is filed against Abri 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 Abri stockholders. In addition, Abri’s Board 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 Abri public stockholders from the Trust Account prior to addressing the claims of creditors.
If Abri’s due diligence
investigation of DLQ was inadequate, then stockholders of Abri following the Business Combination could lose some or all of their investment.
Even though Abri conducted
a due diligence investigation of DLQ, it cannot be sure that this diligence uncovered all material issues that may be present inside DLQ
or its business, or that it would be possible to uncover all material issues through a customary amount of due diligence, or that factors
outside of DLQ and its business and outside of its control will not later arise.
Stockholder litigation and regulatory inquiries
and investigations are expensive and could harm Abri’s business, financial condition and operating results and could divert management
attention.
In the past, securities class action
litigation and/or stockholder derivative litigation and inquiries or investigations by regulatory authorities have often followed certain
significant business transactions, such as the sale of a company or announcement of any other strategic transaction, such as the Business
Combination. Any stockholder litigation and/or regulatory investigations against Abri, whether or not resolved in Abri’s favor,
could result in substantial costs and divert Abri’s management’s attention from other business concerns, which could adversely
affect Abri’s business and cash resources and the ultimate value Abri’s stockholders receive as a result of the Business Combination.
The Initial Stockholders who own shares
of Common Stock and Private Units will not participate in liquidation distributions and, therefore, they may have a conflict of interest
in determining whether the Business Combination is appropriate.
As of the Record Date, the Initial
Stockholders owned an aggregate of 1,728,078 shares of Abri Common Stock and 294,598 Private Units. They have waived their right to redeem
any shares of Common Stock in connection with a stockholder vote to approve a proposed initial business combination or sell any shares
of Common Stock to Abri in a tender offer in connection with a proposed initial business combination, or to receive distributions with
respect to any shares of Common Stock upon the liquidation of the Trust Account if Abri is unable to consummate a business combination.
Based on a market price of $11.00 per Unit on September 25, 2023, the value of the Units was $10,744,206. The Private Units (including
underlying securities) and founder shares acquired prior to the IPO will be worthless if Abri does not consummate a business combination.
Consequently, Abri’s directors’ discretion in identifying and selecting DLQ as a suitable target business may result in a
conflict of interest when determining whether the terms, conditions and timing of the Business Combination are appropriate and in the
Abri public stockholders’ best interest.
Abri is requiring stockholders
who wish to redeem their shares of Common Stock in connection with a proposed business combination 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.
Abri is requiring stockholders
who wish to redeem their shares of Common Stock to either tender their certificates to Continental or to deliver their shares of Common
Stock to Continental electronically using the DTC’s DWAC (Deposit/Withdrawal At Custodian) System at least two business days
before the Meeting. In order to obtain a physical certificate, a stockholder’s broker and/or clearing broker, DTC and Continental
will need to act to facilitate this request. It is Abri’s understanding that stockholders should generally allot at least two weeks
to obtain physical certificates from Continental. 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 certificate. While we have been advised that it takes a
short time to deliver shares of Common Stock through the DWAC System, we cannot assure you of this fact. Accordingly, if it takes longer
than Abri anticipates for stockholders to deliver their shares of Common Stock, stockholders who wish to redeem may be unable to meet
the deadline for exercising their redemption rights and thus may be unable to redeem their shares of Common Stock. Holders of outstanding
Units must separate the underlying shares of Common Stock prior to exercising redemption rights with respect to the shares of Common
Stock. If the Units are registered in a holder’s own name, the holder must deliver the certificate for its Units to Continental,
with written instructions to separate the Units into their individual component parts. This must be completed far enough in advance
to permit the mailing of the certificates back to the holder so that the holder may then exercise his, her or its redemption rights upon
the separation of the shares of Common Stock from the Units.
Abri will require its public stockholders
who wish to redeem their shares of Common Stock in connection with the Business Combination to comply with specific requirements for redemption
described above, such redeeming stockholders may be unable to sell their securities when they wish to in the event that the Business Combination
is not consummated.
If Abri requires public stockholders
who wish to redeem their shares of Common Stock in connection with the proposed Business Combination to comply with specific requirements
for redemption as described above and the Business Combination is not consummated, Abri will promptly return such certificates to its
public stockholders. Accordingly, investors who attempted to redeem their shares of Common Stock in such a circumstance will be unable
to sell their securities after the failed acquisition until Abri has returned their securities to them. The market price of shares of
Common Stock may decline during this time and you may not be able to sell your securities when you wish to, even while other stockholders
that did not seek redemption may be able to sell their securities.
If Abri’s securityholders exercise
their registration rights with respect to their securities, it may have an adverse effect on the market price of Abri’s securities.
Abri’s Initial Stockholders
are entitled to make a demand that it register the resale of their founder shares at any time commencing three months prior to the
date on which their shares may be released from escrow. Additionally, the holders of Representative Shares, the Private Units and
any Units the Sponsor, Initial Stockholders, officers, directors, or their affiliates may be issued in payment of working capital
loans made to Abri, are entitled to demand that Abri register the resale of the Representative Shares, Private Units and any other
Units Abri issues to them (and the underlying securities) commencing at any time after Abri consummates an initial business combination.
If such persons exercise their registration rights with respect to all of their securities, then there will be an additional 1,433,480
shares of Common Stock and 294,598 Units (and underlying securities) eligible for trading in the public market. The presence
of these additional shares of Common Stock and Units (and underlying securities) trading in the public market may have an adverse
effect on the market price of Abri’s securities.
Abri has obtained an
opinion from an unaffiliated third party as to the fairness of the Business Combination to its stockholders.
The Current Charter only requires
a fairness opinion if the target business is affiliated with the Sponsor, or the directors or officers of Abri. This transaction was negotiated
between unrelated parties with no pre-existing relationship and no conflicts of interest were present. However, Abri has obtained an opinion
from The Mentor Group, Inc., an unaffiliated third party, which supports the price Abri is paying in the Business Combination as fair
to its public stockholders from a financial point of view. The Mentor Group delivered a written opinion and final supporting analysis
presentation to the effect that, as of that date and based upon and subject to the factors and assumptions set forth therein, the consideration
to be paid in the Business Combination pursuant to the Merger Agreement is fair to Abri stockholders from a financial point of view. There
is no assurance that this report will have any impact on the price of Abri securities or the Combined Company securities and investors
could experience a loss as a result of decreasing stock prices. The full text of the written opinion, dated December 4, 2022, of The Mentor
Group, which describes, among other things, the assumptions made, procedures followed, factors considered and limitations on the review
undertaken, is attached as Annex D to this proxy statement and is incorporated by reference herein in its entirety.
See “Abri Proposal
1 — The Business Combination Proposal — Opinion of Abri’s Financial Advisor” on page 110 of this proxy statement
for more information.
If the Business Combination’s benefits
do not meet the expectations of financial or industry analysts, the market price of Abri’s securities may decline.
The market price of Abri’s
securities may decline as a result of the Business Combination if:
| · | Abri does not achieve the perceived benefits of the acquisition
as rapidly as, or to the extent anticipated by, financial or industry analysts; or |
| · | The effect of the Business Combination on the financial statements
is not consistent with the expectations of financial or industry analysts. |
Accordingly, investors may
experience a loss as a result of decreasing stock prices.
Abri’s directors and officers may
have certain conflicts in determining to recommend the acquisition of DLQ, since certain of their interests, and certain interests of
their affiliates and associates, are different from, or in addition to, your interests as a stockholder.
Abri’s management and
directors have interests in and arising from the Business Combination that are different from, or in addition to, your interests as a
stockholder, which could result in a real or perceived conflict of interest. These interests include the fact that certain of the shares
of Common Stock and Private Units (including the underlying securities) owned by Abri’s management and directors, or their affiliates
and associates, would become worthless if the Business Combination Proposal is not approved and Abri otherwise fails to consummate a business
combination prior to February 12, 2024. See “Proposal No. 1 — The Business Combination Proposal — Interests of Certain
Persons in the Business Combination” beginning on page 109 for additional information.
Abri and DLQ have incurred and expect to
incur significant costs associated with the Business Combination. Whether or not the Business Combination is completed, the incurrence
of these costs will reduce the amount of cash available to be used for other corporate purposes by Abri if the Business Combination is
completed or by Abri if the Business Combination is not completed.
Abri and DLQ expect to incur significant
costs associated with the Business Combination. Whether or not the Business Combination is completed, Abri expects to incur approximately
$2,400,000 in expenses, not including underwriter commissions totaling $1,500,000. These expenses will reduce the amount of cash available
to be used for other corporate purposes by Abri if the Business Combination is completed or by Abri if the Business Combination is not
completed.
Abri will incur significant
transaction costs in connection with transactions contemplated by the Merger Agreement.
Abri will incur significant
transaction costs in connection with the Business Combination. If the Business Combination is not consummated, Abri may not have sufficient
funds to seek an alternative business combination and may be forced to liquidate and dissolve.
If the Business Combination is completed,
the Combined Company may need to raise additional capital by issuing equity securities or additional debt, which may cause significant
dilution to the combined company’s stockholders or restrict the combined company’s operations, and if such capital is not
available, our business, financial condition and results of operations may be adversely affected.
On September 5, 2023, DLQ
entered into a note purchase agreement with certain investors, pursuant to which DLQ has issued a $5 million convertible promissory note
that will convert into DLQ shares of common stock immediately before the Closing of the Business Combination, which shares shall be exchanged
for 1,600,000 out of the 11,400,000 Merger Consideration Shares (referred to as the “DLQ Investment”). The DLQ
Investment will be used to pay certain fees and expenses in connection with the Business Combination, including closing costs and the
deferred underwriter’s fee and for working capital. There have been no other marketing activities to date to secure financing from
other unaffiliated or external parties. With the funds from the DLQ Investment, the Company believes it will have sufficient funds to
pay closing expenses in the case of Maximum Redemption Scenario. However, the DLQ Investment may not be adequate to fund operations after
the Business Combination, which may make it necessary for the Combined Company to seek additional financing. We may also require additional
capital to pursue our business objectives and respond to business opportunities, challenges or unforeseen circumstances, including to
expand into additional markets, increase our marketing expenditures to improve our brand awareness, enhance our technology, develop new
products or services or further improve existing products and services, enhance our operating infrastructure and acquire complementary
businesses and technologies. If we require additional capital after the Closing, the Sponsor shall be the exclusive financing source of
capital to fund up to $30 million, which capital shall be sourced through debt or equity financings based upon acceptable market conditions
available at that time, and upon agreement by the Company and the Sponsor.
However, additional funds
may not be available when we need them on terms that are acceptable to us, or at all. In addition, any debt financing that we secure in
the future could involve restrictive covenants, which may make it more difficult for us to obtain additional capital and to pursue business
opportunities. Volatility in the credit markets may also have an adverse effect on our ability to obtain debt financing. If we raise additional
funds through further issuances of equity or convertible debt securities, our stockholders could experience significant dilution, and
any new equity securities we issue could have rights, preferences and privileges superior to those of holders of Common Stock.
It is also possible that the
terms of any new equity securities may have preferences over the combined company’s common stock. Any debt financing the combined
company enters into may involve covenants that restrict its operations. These restrictive covenants may include limitations on additional
borrowing and specific restrictions on the use of the combined company’s assets, as well as prohibitions on its ability to create
liens, pay dividends, redeem its stock or make investments. If we are unable to obtain adequate financing or financing on terms satisfactory
to us, when we require it, our ability to continue to pursue our business objectives and to respond to business opportunities, challenges
or unforeseen circumstances could be significantly limited, and our business, financial condition and results of operations could be adversely
affected.
The shares of Common Stock that may be issued
in connection with any debt or equity financing following the Business Combination may dilute the Combined Company’s shareholders.
A significant number of the
shares of Common Stock would become potentially issuable in the event the Combined Company raises additional capital through debt or equity
financing. The lower the market or trading price of shares of Common Stock in the future, the greater the number of shares of Common Stock
that would become potentially issuable to secure adequate funding to the Combined Company. Factors both within and beyond the Combined
Company’s control could cause the market or trading price of the Common Stock to decline, even significantly, in the future. As
a result, shareholders of the Combined Company will have their positions significantly diluted by the potential increase in additional
outstanding shares of Common Stock in connection with any such debt or equity financing.
The unaudited pro forma condensed combined
financial information included in this proxy statement may not be indicative of what the Combined Company’s actual financial position
or results of operations would have been.
The unaudited pro forma condensed
combined financial information in this proxy statement is presented for illustrative purposes only and is not necessarily indicative of
what Combined Company’s actual financial position or results of operations would have been had the Business Combination been completed
on the dates indicated. See the section titled “Unaudited Pro Forma Condensed Combined Financial Information” for more information.
In the event that a significant number of
shares of Abri Common Stock are redeemed, Abri Common Stock may become less liquid following the Business Combination.
If a significant number of
shares of Abri Common Stock are redeemed, Abri may be left with a significantly smaller number of stockholders. As a result, trading in
the shares of the Combined Company may be limited and your ability to sell your shares in the market could be adversely affected. The
Combined Company intends to apply to list its shares on the Nasdaq Stock Market (“Nasdaq”), and Nasdaq may not
list the Common Stock on its exchange, which could limit investors’ ability to make transactions in Abri’s securities and
subject Abri to additional trading restrictions.
Abri is currently not
in compliance with the Nasdaq continued listing requirements. If Abri is unable to regain compliance with Nasdaq’s listing requirements,
its securities could be delisted, which could affect its securities’ market price and liquidity.
Abri’s Units, Common
Stock and Warrants are separately listed on Nasdaq. In order to continue listing Abri’s securities on Nasdaq prior to the initial
business combination, Abri must maintain certain financial, distribution and share price levels. On March 23, 2023, Abri received a letter
(the “MVLS Notice”) from the Listing Qualifications Department (the “Staff”) of Nasdaq
notifying Abri that for the last 30 consecutive business days prior to the date of the MVLS Notice, Abri’s Minimum Value of Listed
Securities (“MVLS”) was less than $35.0 million, which does not meet the requirement for continued listing on
The Nasdaq Capital Market, as required by Nasdaq Listing Rule 5550(b)(2) (the “MVLS Rule”). In accordance with Nasdaq Listing
Rule 5810(c)(3)(C), the Staff has provided Abri with 180 calendar days, or until September 19, 2023, to regain compliance with the MVLS
Rule. The MVLS Notice has no immediate effect on the listing of the Abri’s securities on The Nasdaq Capital Market.
If Abri regains compliance
with the MVLS Rule, the Staff will provide written confirmation to Abri and close the matter. To regain compliance with the MVLS Rule,
Abri’s MVLS must meet or exceed $35.0 million for a minimum of ten consecutive business days during the 180-day compliance period
ending on September 19, 2023. In the event Abri does not regain compliance with the MVLS Rule prior to the expiration of the compliance
period, it will receive written notification that its securities, including the Units, Common Stock and Warrants, are subject to delisting.
At that time, Abri may appeal the delisting determination to a Hearings Panel.
Abri cannot assure you that
it will be able to regain compliance with the MVLS Rule. Abri’s failure to meet this, or any other requirement would result in its
securities being delisted from Nasdaq. Abri and holders of its securities could be materially adversely impacted if its securities are
delisted from Nasdaq. In particular:
| · | the price of Abri securities will likely decrease as a result
of the loss of market efficiencies associated with Nasdaq; |
| · | holders may be unable to sell or purchase Abri’s securities
when they wish to do so; |
| · | Abri may become subject to stockholder litigation; |
| · | Abri may lose the interest of institutional investors in its
securities; |
| · | Abri may lose media and analyst coverage; and |
| · | Abri would likely lose any active trading market for its securities,
as it may only be traded on one of the over-the-counter markets, if at all. |
The Combined Company will be required to
meet the initial listing requirements to be listed on the Nasdaq Stock Market. However, the Combined Company may be unable to maintain
the listing of its securities in the future.
If the Combined Company fails
to meet the continued listing requirements and Nasdaq delists its securities, Abri could face significant material adverse consequences,
including:
| · | a limited availability of market quotations for its securities; |
| · | a limited amount of news and analyst coverage for the Combined
Company; and |
| · | a decreased ability to issue additional securities or obtain
additional financing in the future. |
Abri may waive one or more of the conditions
to the Business Combination without resoliciting stockholder approval for the Business Combination.
Abri may agree to waive, in
whole or in part, some of the conditions to its obligations to complete the Business Combination, to the extent permitted by applicable
laws. The Board will evaluate the materiality of any waiver to determine whether amendment of this proxy statement and re-solicitation
of proxies is warranted. In some instances, if the Board determines that a waiver is not sufficiently material to warrant re-solicitation
of stockholders, Abri has the discretion to complete the Business Combination without seeking further stockholder approval. For example,
it is a condition to Abri’s obligations to close the Business Combination that there be no applicable law and no injunction or other
order restraining or imposing any condition on Closing, however, if the Board determines that any such order or injunction is not material
to the business of DLQ, then the Board may elect to waive that condition without stockholder approval and close the Business Combination.
Abri’s stockholders will experience
immediate dilution as a consequence of the issuance of Common Stock as consideration in the Business Combination. Having a minority share
position may reduce the influence that Abri’s current stockholders have on the management of Abri.
It
is anticipated that, upon Closing, the public stockholders will retain an ownership interest of 8.7% in the Combined Company, the Sponsor
and directors of Abri will retain an ownership interest of 12% in the Combined Company, the Representative will retain an ownership interest
of 0.2% in the Combined Company, DLQ Parent will own 59.3% of the outstanding Common Stock of the Combined Company DLQ Parent Stockholders
will own approximately 20% of the outstanding Common Stock of the Combined Company.
The
ownership percentages set forth above with respect to the Combined Company do not take into account the redemption of any additional shares
of Common Stock by the public stockholders. If the actual facts are different from these assumptions (which they are likely to be), the
percentage ownership retained by the Abri stockholders will be different. See “Unaudited Pro Forma Condensed Combined Financial
Information.”
The Sponsor, members of the Board and Abri’s
executive officers and advisors may have interests in the Business Combination that are different from or in addition to (and which may
conflict with) your interest.
The Sponsor, members of the
Board and Abri’s executive officers and advisors have interests in the Business Combination that are different from or in addition
to (and which may conflict with) your interest. These interests include:
| · | At
an Extension Meeting of Abri’s stockholders held on December 9, 2022, Abri’s stockholders approved (i) a proposal to
amend Abri’s amended and restated certificate of incorporation, and (ii) a proposal to amend the Management Trust Agreement with
the Transfer Agent, to extend the date by which Abri has to consummate a business combination from February 12, 2023 until August 12,
2023, on an as needed, month-to-month basis (each an “Extension”), by depositing an additional $87,500
(a “Contribution”) into the Trust Account for each such one-month Extension (referred to as the “December
9 Amendments”) The Sponsor made aggregate Contributions in the amount of $525,000 to extend the time to complete
a business combination to August 12, 2023; |
| · | If an initial business
combination, such as the Business Combination, is not completed by February 12, 2024, Abri will be required to dissolve and liquidate; |
| |
· |
If the Business Combination is not approved, in accordance with our Charter, the 1,433,480 founder shares held by our Sponsor, our officers and directors, which were acquired prior to the IPO for an aggregate purchase price of $25,000, will be worthless (as the holders have waived liquidation rights with respect to such shares), as will the 294,598 shares of Common stock and 294,598 Private Warrants that were included in the Private Units acquired simultaneously with the IPO and in connection with the exercise of the overallotment option, for an aggregate purchase price of $2,945,980. Irrespective of existing lock-up agreements that impose restrictions on the transfer of the founder shares, the shares of Common Stock in the Private Units and Private Warrants, such founder shares together with the shares of Common Stock in the Private Units, and Private Warrants had an aggregate market value of approximately $3,249,416 based on the last sale price of $10.95 and $0.08, respectively, on Nasdaq on September 25, 2023; |
| · | The Sponsor may receive
up to $13,188,016 (or 20%) of the proceeds of the exercise of the Public Warrants, if the Public Warrants are exercised at $11.50 per
share. The Public Warrants may be redeemed for $0.01 per Public Warrant unless the holder thereof exercises such Public Warrant, so long
as the price per share of the Combined Company’s stock is above $16.50 for over any twenty (20) consecutive trading days. For more
information, see “Summary of the Proxy statement — Agreements to be Executed at Closing — Warrant Revenue Sharing
Side Letter”; |
| · | the fact that the Sponsor may receive up to 1,000,000 Earnout
Shares if the Combined Company achieves certain milestones as follows: |
250,000 Sponsor
Earnout Shares will be earned and released upon satisfaction of the First Milestone Event (as defined in the Sponsor Earnout Agreement),
which would have a value of $4,125,000 with the stock price at $16.50;
350,000 Sponsor
Earnout Shares will be earned and released upon satisfaction of the Second Milestone Event (as defined in the Sponsor Earnout Agreement),
which, including the first tranche of 250,000 Earnout Shares, would have a total value of $13,800,000 with the stock price at $23.00;
and
400,000 Sponsor
Earnout Shares will be earned and released upon satisfaction of the Third Milestone Event (as defined in the Sponsor Earnout Agreement),
which, including the first tranche of 250,000 Earnout Shares plus the second tranche of 350,000 Earnout Shares, would have a total value
of $30,000,000 with the stock price at $30.00.
| · | If the Business Combination is completed, assuming the stock price
of the Combined Company is $30.00 per share, and (i) the Public Warrants are exercised; (ii) the Private Warrants are exercised on a cashless
exercise basis; (iii) all Earnout Share Milestones are achieved; and (iv) the Sponsor and its affiliates still hold 1,728,078 shares
of Common stock (which includes 1,433,480 founder shares plus 294,598 shares included in the Private Units), the Sponsor stands to
gain up to $13,188,016 for the exercise of the Public Warrants; $2,678,164 in value for the 89,272 shares with the cashless exercise
of the Private Warrants; $30,000,000 in value of the Earnout Shares; and $51,842,340 in value of the 1,728,078 shares held, for a
total of $97,708,520. |
| · | On March 8, 2022, the Abri issued a convertible
promissory note (the “First Working Capital Note”) to the Sponsor. Pursuant to the First Working Capital Note,
the Sponsor agreed to loan us an aggregate principal amount of $300,000. On April 4, 2022, Abri issued a second convertible promissory
note for an aggregate principal amount of $500,000 (the “Second Working Capital Note”) to the Sponsor. On August
26, 2022, Abri issued a third convertible promissory note for an aggregate principal amount of $300,000 (the “Third Working
Capital Note”) to the Sponsor. On November 22, 2022, Abri issued a fourth convertible promissory note for an aggregate principal
amount of $150,000 (the “Fourth Working Capital Note”) to the Sponsor. On January 17, 2023, Abri issued a fifth
convertible promissory note for an aggregate principal amount of $200,000 (the “Fifth Working Capital Note”)
to the Sponsor. On February 10, 2023, Abri issued a sixth convertible promissory note for an aggregate principal amount of $150,000 (the
“Sixth Working Capital Note”) to the Sponsor and on July 31, 2023, the Company issued a seventh working
capital note in the amount of $11,250 (the “Seventh Working Capital Note”) to
the Sponsor (the First Working Capital Note through the Seventh Working Capital Notes are hereinafter referred to as the “Working
Capital Notes”). The Working Capital Notes were issued to fund working capital of Abri. The Working Capital Notes are non-interest
bearing and all outstanding amounts under the Working Capital Notes will be due on the date on which we consummate our initial business
combination (the “Maturity Date”); |
| · | On August 5, 2022, Abri deposited $573,392 into the trust account of ABRI (the “Trust Account”),
to extend the time to complete a Business Combination until November 12, 2022. On November 1, 2022, Abri deposited $573,392 into the Trust
Account for the second of two three-month extensions to extend the time to complete a Business Combination until February 12, 2023; |
| · | On February 6, 2023, March 10, 2023, April 11, 2023,
May 11, 2023, June 9, 2023 and July 10, 2023, Abri deposited $87,500 for each one-month extension (or $525,000 in total)
into the Trust Account to extend the time to complete a business combination to August 12, 2023; |
| · | On August 7, 2023, at the Second Extension Meeting, the Abri stockholders approved the proposal to amend
Abri’s Charter: (a) giving Abri the right to extend the date by which it has to complete a business combination to February 12,
2024 without making any further deposits into the Trust Account, and (b) to change the Charter by removing the requirement to have net
tangible assets of at least $5,000,001 upon consummation of a Business Combination; |
| · | If Abri is unable to complete a business combination and distribute
the proceeds held in trust to our public stockholders, Abri’s Sponsor has agreed (subject to certain exceptions) that it will be
liable to ensure that the proceeds in the trust account are not reduced below $10.00 per share by the claims of target businesses or claims
of vendors or other entities that are owed money by Abris for services rendered or contracted for or products sold to Abri; |
| · | All rights specified in Abri’s Charter as amended on December 9,
2022 and August 9, 2023 relating to the right of officers and directors to be indemnified by Abri, and of Abri’s officers and directors
to be exculpated from monetary liability with respect to prior acts or omissions, will continue after a business combination. If
the Business Combination is not approved and Abri liquidates, Abri will not be able to perform its obligations to its officers and directors
under those provisions; |
| · | The exercise of Abri’s directors’ and officers’
discretion in agreeing to changes or waivers in the terms of the transaction may result in a conflict of interest when determining whether
such changes or waivers are appropriate and in Abri’s stockholders’ best interest; |
| · | Our Sponsor, officers, directors, initial stockholders or their
affiliates, are entitled to 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 business combinations. However, if Abri fails to consummate
the Business Combination, they will not have any claim against the trust account for reimbursement. Accordingly, Abri will most likely
not be able to reimburse these expenses if the Business Combination is not completed, including any balances outstanding on any Working
Capital Notes, as described herein, issued to Abri by the Sponsor. As of March 31, 2023, $1,600,000 is outstanding from the Working
Capital Notes, $1,146,784 for two payments of $573,392 for the two three-month extensions, plus two payments of $87,500 ($175,000)
for a one month extension, and there are no out-of-pocket expenses owed to Abri’s officers, directors or Sponsor; |
| · | If a business combination is not consummated, and there are insufficient
funds to repay the Working Capital Notes, the automatic extension payments of $1,146,784, the six one-month extension payments of $87,500
for a total of $1,671,784 in extension payments through August 12, 2023, and any further Extension payments made, all unpaid amounts would
be forgiven. All or a portion of the amounts outstanding under the Working Capital Notes may be converted on the Maturity Date into Units
at a price of $10.00 per Unit at the option of the Sponsor. The Units would be identical to Abri’s outstanding Private Units that
were issued to the Sponsor in the Private Placement. The Working Capital Notes contain customary events of default, including, among others,
those relating to Abri’s failure to make a payment of principal when due and to perform any other obligations that is not timely
cured after written notice of such default from the Sponsor; |
| · | In light of the foregoing, the Sponsor and its affiliates will receive
material benefits from Closing and may be incentivized to complete the Business Combination with DLQ rather than liquidate even if (i) DLQ
is a less favorable target company or (ii) the terms of the Business Combination are less favorable to stockholders. As a result,
our Sponsor and its affiliates may have interests in the Closing that are materially different than, and may conflict with, the interests
of other stockholders. Further, the Sponsor and its affiliates who hold founder shares or Private Warrants may receive a positive return
on their investment(s), even if the public stockholders experience a negative return on their investment after consummation of the Business
Combination; |
These interests may influence
Abri’s directors in making their recommendation that you vote in favor of the approval of the Business Combination.
Abri may be subject
to the Excise Tax included in the Inflation Reduction Act of 2022 in connection with redemptions of Abri Common Stock after December 31,
2022.
On
August 16, 2022, President Biden signed into law the Inflation Reduction Act of 2022, which, among other things, imposes a 1% excise
tax on any publicly traded domestic corporation that repurchases its stock after December 31, 2022 (the “Excise Tax”).
The Excise Tax is imposed on the fair market value of the repurchased stock, with certain exceptions. Because Abri is a Delaware corporation
and because its securities trade on Nasdaq, it is a “covered corporation” within the meaning of the Inflation Reduction Act.
While not free from doubt, absent any further guidance from the U.S. Department of the Treasury (the “Treasury”),
who has been given authority to provide regulations and other guidance to carry out and prevent the abuse or avoidance of the Excise Tax,
the Excise Tax may apply to any redemptions of Abri Common Stock after December 31, 2022, including redemptions in connection with
the Business Combination, unless an exemption is available. Generally, issuances of securities in connection with an initial business
combination transaction (including any PIPE transaction at the time of an initial business combination) are expected to reduce the amount
of the Excise Tax in connection with redemptions occurring in the same calendar year. In addition, the Excise Tax would be payable by
us, and not by the redeeming holder, however the mechanics of any required payment of the Excise Tax have not been determined. Further,
based on recently issued interim guidance from the Internal Revenue Service and Treasury in Notice 2023-2, subject to certain exceptions,
the Excise Tax should not apply in the event of Abri’s liquidation.
Risks Related to Combined Company’s Common
Stock
The Combined Company’s stock price
may fluctuate significantly.
The market price of the Combined
Company’s Common Stock may fluctuate widely, depending on many factors, some of which may be beyond our control, including:
| · | actual or anticipated fluctuations in our results of operations
due to factors related to its business; |
| · | success or failure of its business strategies; |
| · | competition and industry capacity; |
| · | changes in interest rates and other factors that affect earnings
and cash flow; |
| · | its level of indebtedness, its ability to make payments on or
service its indebtedness and its ability to obtain financing as needed; |
| · | its ability to retain and recruit qualified personnel; |
| · | its quarterly or annual earnings, or those of other companies
in its industry; |
| · | announcements by us or its competitors of significant acquisitions
or dispositions; |
| · | changes in accounting standards, policies, guidance, interpretations
or principles; |
| · | the failure of securities analysts to cover, or positively cover,
its Common Stock after the Business Combination; |
| · | changes in earnings estimates by securities analysts or its
ability to meet those estimates; |
| · | the operating and stock price performance of other comparable
companies; |
| · | investor perception of the company and its industry; |
| · | overall market fluctuations unrelated to its operating performance; |
| · | results from any material litigation or government investigation; |
| · | changes in laws and regulations (including tax laws and regulations)
affecting its business; |
| · | changes in capital gains taxes and taxes on dividends affecting
stockholders; and |
| · | general economic conditions and other external factors. |
Low trading volume for the
Combined Company’s Common Stock, which may occur if an active trading market does not develop, among other reasons, would amplify
the effect of the above factors on stock price volatility.
Should the market price of
our shares drop significantly, stockholders may institute securities class action lawsuits against us. A lawsuit against the Combined
Company could cause the Combined Company to incur substantial costs and could divert the time and attention of its management and other
resources.
Even if the Business Combination is consummated,
the Public Warrants may never be in the money, and they may expire worthless.
The exercise price for our
warrants is $11.50 per share. There can be no assurance that the Public Warrants will be in the money prior to their expiration and, as
such, the Public Warrants may expire worthless. The terms of our Public Warrants may be amended in a manner that may be adverse to the
holders. The warrant agreement between Continental Stock Transfer & Trust Company, as warrant agent, and us provides that the
terms of the Public Warrants may be amended without the consent of any holder to cure any ambiguity or correct any defective provision,
but requires the approval by the holders of a majority of the then-outstanding Public Warrants to make any change that adversely affects
the interests of the registered holders. Accordingly, we may amend the terms of the Public Warrants in a manner adverse to a holder if
holders of a majority of the then-outstanding Public Warrants approve of such amendment. Our ability to amend the terms of the Public
Warrants (including the Private 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 Public Warrants, shorten the exercise
period or decrease the number of shares of our Common Stock purchasable upon exercise of a Public Warrant.
An investor will only be able to exercise
the Public Warrants if the issuance of shares 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 have been registered or qualified or deemed to be exempt under the securities laws of the state of residence of the holder of
the Public Warrants. At the time that the Warrants become exercisable, we expect to continue to be listed on a national securities exchange,
which would provide an exemption from registration in every state. However, we cannot assure you of this fact. If the shares of Common
Stock issuable upon exercise of the Public Warrants are not qualified or exempt from qualification in the jurisdictions in which the holders
of the Public 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.
Management’s ability to require holders
of our Public Warrants to exercise such Public Warrants on a cashless basis will cause holders to receive fewer shares of Common Stock
upon their exercise of the Public Warrants than they would have received had they been able to exercise their Public Warrants for cash.
If Abri calls its Public Warrants
for redemption after the redemption criteria have been satisfied (only if, the reported last sale price of the shares of Common Stock
equals or exceeds $16.50 per share, for any 20 trading days within a 30 trading day period ending on the third business day
prior to the notice of redemption to warrant holders, and if there is a current registration statement in effect with respect to the shares
of Common Stock underlying such Public 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) our management will have the option to require any holder that wishes
to exercise its Public Warrants (including any Public Warrants held by our initial stockholders 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 fewer than it would have been had such holder exercised its
warrants for cash. This will have the effect of reducing the potential “upside” of the holder’s investment in our company.
Recent Common Stock trading prices have not met the threshold that would allow us to redeem Public Warrants.
The Private Warrants are identical
to the Public Warrants except that the Private Warrants will be exercisable for cash (even if a registration statement covering the shares
of Common Stock issuable upon exercise of such warrants is not effective) or on a cashless basis, at the holder’s option, and will
not be redeemable by us, in each case so long as they are still held by the initial purchasers or their affiliates. If the private warrants
are held by holders other than the Sponsor or its permitted transferees, the Private Warrants will be redeemable by us and exercisable
by the holders on the same basis as the Public Warrants.
We may redeem your unexpired Public 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 Public Warrants (excluding any Private Warrants held by our Sponsor or its permitted transferees) at any time after they become
exercisable and prior to their expiration, at $0.01 per warrant, provided that the last reported sales price (or the closing bid price
of our Common Stock in the event the shares of our Common Stock are not traded on any specific trading day) of the Common Stock equals
or exceeds $16.50 per share (as adjusted for stock splits, stock dividends, reorganizations and the like) on each of 20 trading days
within the 30 trading-day period ending on the third business day prior to the date on which we send proper notice of such redemption,
provided that on the date we give notice of redemption and during the entire period thereafter until the time we redeem the Public Warrants,
we have an effective registration statement under the Securities Act covering the shares of Common Stock issuable upon exercise of the
Public Warrants and a current prospectus relating to them is available. If and when the warrants become redeemable by us, we may exercise
our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities
laws. Redemption of the outstanding Public Warrants could force a warrant holder: (i) to exercise its Public Warrants and pay the
exercise price therefor at a time when it may be disadvantageous for it to do so, (ii) to sell its Public Warrants at the then-current
market price when it might otherwise wish to hold its Public Warrants or (iii) to accept the nominal redemption price which, at the
time the outstanding warrants are called for redemption, will be substantially less than the market value of its Public Warrants.
The State of New York will be the exclusive
forum for substantially all disputes between Abri and/or the Combined Company and the Public Warrant holders, which could limit the Public
Warrant holders’ ability to obtain a favorable judicial forum for disputes in connection with the Public Warrants.
The Public Warrants shall
be governed in all respects by the laws of the State of New York, without giving effect to conflict of laws. Subject to applicable
law, any action, proceeding or claim against the Combined Company arising out of or relating in any way to the Warrant Agreement 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, which jurisdiction shall be exclusive forum for any such action, proceeding or claim. This provision does 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. 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.
Any person or entity purchasing
or otherwise acquiring any interest in the Public Warrants shall be deemed to have notice of and to have consented to the forum provisions.
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 New York or the United States District Court for the Southern District of New York in the name of any Public
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, and (y) having service of process made upon
such Public Warrant holder in any such enforcement action by service upon such Public Warrant holder’s counsel in the foreign action
as agent for such Public Warrant holder.
This choice of forum provision
may limit a warrant holder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with Abri or its
directors, officers, or other employees, which, along with potential increased costs of litigating in the courts provided by the choice
of forum provision, may discourage such lawsuits against Abri and its directors, officers, and employees. Alternatively, if a court were
to find these provisions of the Abri Warrant Agreement inapplicable to, or unenforceable in respect of, one or more of the specified types
of actions or proceedings, Abri may incur additional costs associated with resolving such matters in other jurisdictions, which could
adversely affect the Combined Company’s business and financial condition.
An active, liquid trading market for the
Combined Company’s Common Stock may not develop, which may limit your ability to sell your shares.
An active trading market for
the Combined Company’s shares of Common Stock may never develop or be sustained following Closing. A public trading market having
the desirable characteristics of depth, liquidity and orderliness depends upon the existence of willing buyers and sellers at any given
time, such existence being dependent upon the individual decisions of buyers and sellers over which neither the Combined Company nor any
market maker has control. The failure of an active and liquid trading market to develop and continue would likely have a material adverse
effect on the value of the Combined Company’s Common Stock. An inactive market may also impair the Combined Company’s ability
to raise capital to continue to fund operations by issuing shares and may impair the Combined Company’s ability to acquire other
companies or technologies by using the Combined Company’s shares as consideration.
Your percentage ownership in the Combined
Company may be diluted in the future.
Stockholders’ percentage
ownership in the Combined Company may be diluted in the future because of equity issuances for acquisitions, capital market transactions
or otherwise, including equity awards that the Combined Company will be granting to directors, officers and other employees. The Abri
Board has adopted the incentive plan subject to stockholder approval, for the benefit of certain of our current and future employees,
service providers and non-employee directors. Such awards will have a dilutive effect on our earnings per share, which could adversely
affect the market price of our Common Stock.
From time-to-time, the Combined
Company may opportunistically evaluate and pursue acquisition opportunities, including acquisitions for which the consideration thereof
may consist partially or entirely of newly-issued shares of Combined Company’s Common Stock and, therefore, such transactions, if
consummated, would dilute the voting power and/or reduce the value of our Common Stock.
The issuance of additional shares of Common
Stock, preferred stock or other convertible securities may dilute your ownership and could adversely affect the stock price.
From time to time in the future,
the Combined Company may issue additional shares of Common Stock, preferred stock or other securities convertible into Common Stock pursuant
to a variety of transactions, including acquisitions. Additional shares of Common Stock may also be issued upon exercise of outstanding
stock options and warrants to purchase Common Stock. The issuance by us of additional shares of Common Stock or securities convertible
into Common Stock would dilute your ownership of the Combined Company and the sale of a significant amount of such shares in the public
market could adversely affect prevailing market prices of our Common Stock. Subject to the satisfaction of vesting conditions and the
expiration of lockup agreements, shares issuable upon exercise of options will be available for resale immediately in the public market
without restriction.
Issuing additional shares
of the Combined Company’s capital stock, other equity securities or securities convertible into equity may dilute the economic and
voting rights of our existing stockholders, reduce the market price of our Common Stock or both. Debt securities convertible into equity
could be subject to adjustments in the conversion ratio pursuant to which certain events may increase the number of equity securities
issuable upon conversion. Preferred stock, if issued, could have a preference with respect to liquidating distributions or a preference
with respect to dividend payments that could limit our ability to pay dividends to the holders of our Common Stock. The Combined Company’s
decision to issue securities in any future offering will depend on market conditions and other factors beyond our control, which may adversely
affect the amount, timing, or nature of our future offerings. As a result, holders of the Combined Company’s Common Stock bear the
risk that the Combined Company’s future offerings may reduce the market price of the Combined Company’s Common Stock and dilute
their percentage ownership.
Future sales, or the perception of future
sales, of the Combined Company’s Common Stock by the Combined Company or its existing stockholders in the public market could cause
the market price for the Combined Company’s Common Stock to decline.
The sale of substantial amounts
of shares of the Combined Company’s Common Stock in the public market, or the perception that such sales could occur, could harm
the prevailing market price of shares of Common Stock. These sales, or the possibility that these sales may occur, also might make it
more difficult for us to sell equity securities in the future at a time and at a price that we deem appropriate.
In connection with the Business
Combination, certain of Abri’s stockholders agreed that, subject to certain exceptions, they will not, during the period beginning
at the effective time of the Business Combination and the date that is 180 days after the date of the Business Combination (subject
to early release if DLQ consummates a liquidation, merger, share exchange or other similar transaction with an unaffiliated third party),
directly or indirectly, offer, sell, contract to sell, pledge, grant any option to purchase, make any short sale, or otherwise dispose
of any shares of Common Stock, or any options or warrants to purchase any shares of Common Stock, or any securities convertible into,
exchangeable for, or that represent the right to receive shares of Common Stock, or any interest in any of the foregoing.
Upon the expiration or waiver
of the lock-up described above, shares held by these stockholders will be eligible for resale, subject to, in the case of stockholders
who are our affiliates, volume, manner of sale, and other limitations under Rule 144 promulgated under the Securities Act.
In addition, certain of our
stockholders will have registration rights under a registration rights agreement to be entered into prior to the Closing pursuant to which
we are obligated to register such stockholders’ shares of Common Stock and other securities that such stockholders may acquire after
the Closing. Upon the effectiveness of the applicable registration statement, these shares of Common Stock will be available for resale
without restriction, subject to any lock-up agreement.
In addition, shares of our
Common Stock issuable upon exercise or vesting of incentive awards under our incentive plans are, once issued, eligible for sale in the
public market, subject to any lock-up agreements and, in some cases, limitations on volume and manner of sale applicable to affiliates
under Rule 144. Furthermore, shares of our Common Stock reserved for future issuance for any stock option plan may become available
for sale in future.
The market price of shares
of our Common Stock could drop significantly if the holders of the shares described above sell them or are perceived by the market as
intending to sell them. These factors could also make it more difficult for us to raise additional funds through future offerings of shares
of our Common Stock or other securities.
If securities or industry analysts publish
inaccurate or unfavorable research or reports about the Combined Company’s business, its stock price and trading volume could decline.
The trading market for the
Common Stock depends, in part, on the research and reports that third-party securities analysts publish about us and the industries in
which we operate. We may be unable or slow to attract research coverage and if one or more analysts cease coverage of the Combined Company,
the price and trading volume of our securities would likely be negatively impacted. If any of the analysts that may cover us change their
recommendation regarding our Common Stock adversely, or provide more favorable relative recommendations about our competitors, the price
of our Common Stock would likely decline. If any analyst that may cover the Combined Company ceases covering us or fails to regularly
publish reports on us, we could lose visibility in the financial markets, which could cause the price or trading volume of our Common
Stock to decline. Moreover, if one or more of the analysts who cover us downgrades our Common Stock, or if our reporting results do not
meet their expectations, the market price of our Common Stock could decline.
The Combined Company may be subject to securities
litigation, which is expensive and could divert management attention.
Following the Business Combination,
the per share price of the Common Stock may be volatile and, in the past, companies that have experienced volatility in the market price
of their stock have been subject to securities litigation, including class action litigation. Litigation of this type could result in
substantial costs and diversion of management’s attention and resources, which could have a material adverse effect on the Combined
Company’s business, financial condition, and results of operations. Any adverse determination in litigation could also subject the
Combined Company to significant liabilities.
Certain Risks and Potential Disadvantages Associated
with the Reverse Stock Split
We cannot assure you
that the proposed Reverse Stock Split will increase the price of our common stock.
We expect
that the Reverse Stock Split will increase the market price of our common stock. However, the effect of the Reverse Stock Split on the
market price of our common stock cannot be predicted with any certainty, and the history of reverse stock splits for other companies in
our industry is varied, particularly because investors may view a reverse stock split negatively. It is possible that the per share price
of our common stock after the Reverse Stock Split will not increase in the same proportion as the reduction in the number of outstanding
shares of common stock following the Reverse Stock Split, and the Reverse Stock Split may not result in a per share price that would attract
investors who do not trade in lower-priced securities. In addition, we cannot assure you that our common stock will be more attractive
to investors. Even if we implement the Reverse Stock Split, the market price of our common stock may decrease due to factors unrelated
to the Reverse Stock Split, including our future performance. If the Reverse Stock Split is consummated and the trading price of our common
stock declines, the percentage decline as an absolute number and as a percentage of our overall market capitalization may be greater than
would occur in the absence of the Reverse Stock Split.
The proposed Reverse
Stock Split may decrease the liquidity of our common stock and result in higher transaction costs.
The
Reverse Stock Split may decrease the liquidity of our common stock because fewer shares would be issued and outstanding after the Reverse
Stock Split. In addition, if the Board implements the Reverse Stock Split, more stockholders may own “odd lots” of fewer than
100 shares of common stock, which may be more difficult to sell. Brokerage commissions and other costs of transactions in odd lots are
generally higher than the costs of transactions of more than 100 shares or multiples of 100 shares of common stock. Accordingly, the Reverse
Stock Split may not achieve the desired results of increasing marketability of the common stock as described above.
If the Reverse Stock
Split is approved and effected, the resulting per-share market price may not attract institutional investors or investment funds and may
not satisfy the investing guidelines of such investors and, consequently, the trading liquidity of our common stock may not improve.
While
the Board believes that a higher stock price may help generate investor interest, there can be no assurance that the Reverse Stock Split
will result in a per-share market price that will attract institutional investors or investment funds or that such share price will satisfy
the investing guidelines of institutional investors or investment funds. As a result, the trading liquidity of our common stock may not
necessarily improve.
A decline in the market
price of our common stock after the Reverse Stock Split is approved and effected may result in a greater percentage decline than would
occur in the absence of the Reverse Stock Split.
If the
Reverse Stock Split is approved and effected and the market price of our common stock declines, the percentage decline may be greater
than would occur in the absence of the Reverse Stock Split. The market price of our common stock will, however, also be based upon our
performance and other factors, which are unrelated to the number of shares of common stock outstanding.
THE MEETING
General
Logiq, Inc. (“Logiq”
o “DLQ Parent”) is furnishing this proxy statement to the its stockholders as part of the solicitation of proxies
by the Board for use at the Meeting of Logiq, Inc. stockholders to be held on October 23, 2023 and at any adjournment or postponement
thereof. This proxy statement is first being furnished to our stockholders on or about September 25,
2023 in connection with the vote on the Proposals. This proxy statement provides you with the information you need to know to be able
to vote or instruct your vote to be cast at the Meeting.
Date, Time and Place
The Meeting will be held virtually
at 11:00am., Eastern Time, on October 23, 2023 or such other date, time and place to which such meeting may be adjourned or postponed,
for the purposes set forth in the accompanying notice. There will not be a physical location for the Meeting, and you will not be able
to attend the meeting in person. We are pleased to utilize the virtual stockholder meeting technology to provide ready access and cost
savings for the stockholders and Logiq, Inc. The virtual meeting format allows attendance from any location in the world. You will
be able to attend, vote your shares, view the list of stockholders entitled to vote at the Meeting and submit questions during the Meeting.
Virtual Meeting Registration
To register for the virtual
meeting, please follow these instructions as applicable to the nature of your ownership of Logiq Common Stock.
If your shares are registered
in your name with Nevada Agency and Trust Company and you wish to attend the online-only virtual meeting, go to www.virtualshareholdermeeting.com/LGIQ2023SM,
enter the control number you received on your proxy card and click on the “Click here” to preregister for the online meeting
link at the top of the page. Just prior to the start of the meeting you will need to log back into the meeting site using your control
number. Pre-registration is recommended but is not required in order to participate in the virtual Meeting.
Beneficial stockholders who
wish to participate in the online-only virtual meeting must obtain a legal proxy by contacting their account representative at the bank,
broker, or other nominee that holds their shares and email a copy (a legible photograph is sufficient) of their legal proxy to Logiq.
Beneficial stockholders who email a valid legal proxy will be issued a meeting control number that will allow them to register to attend
and participate in the online-only meeting. After contacting Nevada Agency and Trust Company a beneficial holder will receive an email
prior to the meeting with a link and instructions for entering the virtual Meeting. Beneficial stockholders should contact Nevada Agency
and Trust Company at least five business days prior to the meeting date.
Record Date; Who is Entitled to Vote
Logiq, has fixed the close of
business on September 25, 2023, as the record date for determining those Logiq stockholders entitled to notice of and to vote at the Meeting.
As of the close of business on September 25, 2023, there were 105,284,314 shares of Common Stock issued and outstanding and entitled to
vote. If your shares are held in “street name,” you should contact your broker, bank or other nominee to ensure that shares
held beneficially by you are voted in accordance with your instructions.
Quorum and Required Vote for the Proposals
A quorum of Logiq stockholders
is necessary to hold a valid meeting. A quorum will be present at the Meeting if a majority of the shares of Common Stock issued and outstanding
is present in person by virtual attendance or represented by proxy and entitled to vote at the Meeting. Abstentions in person by virtual
attendance and by proxy will count as present for the purposes of establishing a quorum but broker non-votes will not.
Approval of the Business Combination
Proposal, the Reverse Stock Split Proposal and the Adjournment Proposal will each require the affirmative vote of the holders of a majority
of the issued and outstanding shares of Common Stock present in person by virtual attendance or represented by proxy and entitled to vote
at the Meeting or any adjournment thereof. Attending the Meeting either in person by virtual attendance or by submitting your proxy and
abstaining from voting will have the same effect as voting against all the Proposals. Assuming a quorum is present, broker non-votes will
have the same effect as voting “AGAINST” the Reverse Stock Split Proposal, and will have no effect on the vote for any other
Proposal.
Voting Your Shares
Each share of Common Stock
that you own in your name entitles you to one vote on each Proposal for the Meeting. Your proxy card shows the number of shares of Common
Stock that you own.
There are two ways to ensure
that your shares of Common Stock are voted at the Meeting:
| · | You can vote your shares by signing, dating and returning the
enclosed proxy card in the pre-paid postage envelope provided. If you submit your proxy card, your “proxy,” whose name is
listed on the proxy card, will vote your shares as you instruct on the proxy card. If you sign and return the proxy card but do not give
instructions on how to vote your shares, your shares will be voted, as recommended by our board. Our Board recommends voting “FOR”
each of the Proposals. If you hold your shares of Common Stock in “street name,” which means your shares are held of record
by a broker, bank or other nominee, you should follow the instructions provided to you by your broker, bank or nominee to ensure that
the votes related to the shares you beneficially own are properly represented and voted at the Meeting. |
| · | You can participate in the virtual Meeting and vote during the
Meeting even if you have previously voted by submitting a proxy as described above. However, if your shares are held in the name of your
broker, bank or another nominee, you must get a proxy from the broker, bank or other nominee. That is the only way Abri can be sure that
the broker, bank or nominee has not already voted your shares. |
IF YOU RETURN YOUR PROXY CARD
WITHOUT AN INDICATION OF HOW YOU WISH TO VOTE, YOUR SHARES WILL BE VOTED IN FAVOR OF THE BUSINESS COMBINATION PROPOSAL (AS WELL AS THE
OTHER PROPOSALS).
Revoking Your Proxy
If you give a proxy, you may
revoke it at any time before it is exercised by doing any one of the following:
| · | you may send another proxy card with a later date; |
| · | if you are a record holder, you may notify Logiq in writing
before the Meeting that you have revoked your proxy; or |
| · | you may participate in the virtual Meeting, revoke your proxy,
and vote during the virtual Meeting, as indicated above. |
Who Can Answer Your Questions About Voting
Your Shares
If you have any questions
about how to vote or direct a vote in respect of your shares of Common Stock, you may contact Logiq:
Brent Suen
85 Broad Street, 16-079
New York, NY 10004
(808) 829-1057
Email: contact@logiq.com
No Additional Matters May Be Presented at the
Meeting
This Meeting has been called
only to consider the approval of the Business Combination Proposal, and the Adjournment Proposal. Under our Certificate of Incorporation,
other than procedural matters incident to the conduct of the Meeting, no other matters may be considered at the Meeting if they are not
included in the notice of the Meeting.
Approval of the Business Combination
Proposal, the and the Adjournment Proposal will each require the affirmative vote of the holders of a majority of the issued and outstanding
shares of Common Stock present in person by virtual attendance or represented by proxy and entitled to vote at the Meeting or any adjournment
thereof. Attending the Meeting either in person by virtual attendance or by submitting your proxy and abstaining from voting will have
the same effect as voting against all the Proposals.
Appraisal Rights
Appraisal rights are not available
to securityholders of Logiq in connection with the proposed Business Combination.
Proxies and Proxy Solicitation Costs
Logiq is soliciting proxies
on behalf of the Board. This solicitation is being made by mail but also may be made by telephone or in person. Logiq and its directors,
officers and employees may also solicit proxies in person, by telephone or by other electronic means. Any solicitation made and information
provided in such a solicitation will be consistent with the written proxy statement proxy card. Abri will bear the cost of its solicitation.
Logiq will ask banks, brokers
and other institutions, nominees and fiduciaries to forward its proxy materials to their principals and to obtain their authority to execute
proxies and voting instructions. Logiq will reimburse them for their reasonable expenses.
PROPOSAL 1
PROPOSAL NO. 1 — THE BUSINESS
COMBINATION PROPOSAL
We are asking Logiq stockholders
to adopt the Merger Agreement and approve the Business Combination and the other transactions contemplated thereby. Logiq stockholders
should read carefully this proxy statement in its entirety, including the subsection below titled “The Merger Agreement,”
for more detailed information concerning the Business Combination and the terms and conditions of the Merger Agreement. We also urge our
stockholders to read carefully the Merger Agreement in its entirety before voting on this Proposal. A copy of the Merger Agreement is
attached as Annex A to this proxy statement.
Merger Agreement
On
September 9, 2022, Abri SPAC I, Inc., a Delaware corporation (“Abri”), entered into a Merger Agreement
(the “Merger Agreement”) by and among Abri Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary
of Abri (“Merger Sub”), Logiq, Inc., a Delaware corporation (“DLQ Parent”) whose common
stock is quoted on the OTCQX Market under the ticker symbol, “LGIQ”, and DLQ, Inc., a Nevada corporation (“DLQ”)
and wholly owned subsidiary of DLQ Parent. Pursuant to the terms of the Merger Agreement, a business combination between Abri and DLQ
will be effected through the merger of Merger Sub with and into DLQ, with DLQ surviving the merger as a wholly owned subsidiary of Abri
(the “Merger”). The board of directors of Abri has (i) approved and declared advisable the Merger Agreement,
the Additional Agreements (as defined in the Merger Agreement) and the transactions contemplated thereby and (ii) resolved to recommend
approval of the Merger Agreement and related transactions by the stockholders of Abri.
On
May 1, 2023 Abri, Abri Sub, DLQ Parent, and DLQ entered into the First Merger Agreement Amendment removing the closing condition
requiring Abri to have net tangible assets in excess of $5,000,001 either immediately prior to or upon consummation of the Merger.
On
June 8, 2023 Abri, Abri Sub, DLQ Parent, and DLQ entered into the Second Merger Agreement Amendment to (i) amend the exchange on
which its securities can be listed in connection with the Business Combination to include being listed on Nasdaq Global Market, and (ii)
waive any default of Section 9.1(i) of the Merger Agreement for having received the MVLS Notice from Nasdaq.
On
July 20, 2023, Abri, Abri Sub, DLQ Parent, and DLQ entered into an amendment to the Merger Agreement (the “Third Merger Agreement
Amendment”) to waive closing conditions and covenants from the Merger Agreement related to the removal of the Sister Companies
from the Business Combination and for the name of the Combined Company to be Collective Audience, Inc.
On
August 28, 2023, Abri entered into an amendment to the Merger Agreement (the “Fourth Merger Agreement Amendment”)
to (i) increase the number of Dividend Shares to be issued to DLQ Parent stockholders at the Closing of the Business Combination from
25% of the Merger Consideration Shares to 33% of the Merger Consideration Shares, (ii) distribute 14% of the aggregate Merger Consideration
Shares to certain DLQ investors, and (iii) to ensure 53% of the Merger Consideration Shares will be subject to lock-up.
The
Merger is expected to be consummated after obtaining the required approval by the stockholders of Abri, DLQ and DLQ Parent and the satisfaction
of certain other customary closing conditions.
Merger Consideration
The total consideration to
be paid at Closing (the “Merger Consideration”) by Abri to DLQ security holders will be an amount equal to $114
Million. The Merger Consideration will be payable in shares of common stock, par value $0.0001 per share, of Abri (“Abri Common
Stock”).
Treatment of DLQ Securities
Cancellation of Securities
Each share of DLQ Common Stock
(defined below), if any, that is owned by Abri, Merger Sub, DLQ, or any other affiliate of Abri(as treasury stock or otherwise) immediately
prior to the effective time of the Merger (the “Effective Time”), will automatically be cancelled and retired
without any conversion or consideration.
| · | DLQ Common Stock. At the Effective Time, each issued
and outstanding share of DLQ’s common stock, par value $0.0001 per share (“DLQ Common Stock”) (other
than any such shares of DLQ common stock cancelled as described above) will be converted into the right to receive a number of shares
of Abri Common Stock equal to the Conversion Ratio. |
| · | “Conversion Ratio” means the quotient obtained
by dividing (a) the Per Share Merger Consideration by (b) $10.00. |
| · | “Per Share Merger Consideration” means an
amount equal to $114,000,000, divided by the number of Fully Diluted Company Shares. |
| · | “Fully Diluted Company Shares” means the
sum, without duplication, of (a) all shares of DLQ Common Stock that are issued and outstanding immediately prior to the Effective
Time plus (b) all shares of DLQ Common Stock issuable upon conversion, exercise or exchange of any other in-the-money securities
of the DLQ convertible into or exchangeable or exercisable for shares of DLQ Common Stock; |
| · | “Merger Consideration Shares” means an aggregate
number of shares of Abri Common Stock equal to the product of (i) the Conversion Ratio, multiplied by (ii) Fully-Diluted Company
Shares. |
| · | “Dividend Shares” means the number of Merger
Consideration Shares that DLQ Parent will issue as a dividend to the DLQ Parent Stockholders concurrent with Closing (the “Distribution”),
on a pro rata basis in an amount equal to approximately thirty three (33%) of the aggregate Merger Consideration Shares (the “Dividend
Shares”). The remaining Merger Consideration Shares held by DLQ Parent will be subject to a lock-up in accordance with
the terms and conditions more fully set forth in the Lock-Up Agreement, as described herein. |
Merger Sub Securities
Each share of common stock,
par value $0.0001 per share, of Merger Sub issued and outstanding immediately prior to the Effective Time will be converted into and become
one newly issued share of common stock of the surviving corporation of the Merger.
Representations and Warranties
The
Merger Agreement contains customary representations and warranties of the parties thereto with respect to, among other things: (a) corporate
existence and power; (b) authorization to enter into the Merger Agreement and related transactions; (c) governmental authorization;
(d) non-contravention; (e) capitalization; (f) corporate records; (g) subsidiaries; (h) consents; (i) financial
statements; (j) books and records; (k) internal accounting controls; (l) absence of certain changes; (m) properties;
title to assets; (n) litigation; (o) contracts; (p) licenses and permits; (q) compliance with laws; (r) intellectual
property; (s) accounts payable; affiliate loans; (t) employee matters and benefits; (u) real property; (v) tax matters;
(w) environmental laws; (x) finders’ fees; (y) powers of attorney, suretyships and bank accounts; (z) directors
and officers; (aa) anti-money laundering laws; (ab) insurance; (ac) related party transactions; and (ad) certain representations
related to securities law and activity. Abri has additional representations and warranties, including (a) issuance of shares; (b) trust
fund; (c) listing; (d) board approval; (e) SEC documents and financial statements; (f) certain business practices;
and (g) expenses, indebtedness and other liabilities.
Covenants
The
Merger Agreement includes customary covenants of the parties with respect to operation of their respective businesses prior to consummation
of the Merger and efforts to satisfy conditions to consummation of the Merger. The Merger Agreement also contains additional covenants
of the parties, including, among others, conduct of business, access to information, notice of certain events, cooperation in the preparation
of the Form S-4 and Proxy Statement (as each such term is defined in the Merger Agreement) required to be filed in connection
with the Merger and to obtain all requisite approvals of each party’s respective stockholders. The Merger Agreement also contains
additional covenants pertaining to DLQ and DLQ Parent including reporting; compliance with laws; no insider trading, commercially reasonable
efforts to obtain consents, DLQ Stockholder and DLQ Parent Stockholder approval, provide additional financial information, execute Lock-Up Agreements,
amend parent charter, issue dividend shares to DLQ Parent Stockholders, transfer certain assets as described in the Merger Agreement,
not issue any dividends or extraordinary bonuses until 11 months after closing, execute certain employment agreements and take reasonable
efforts to enter into a financing source agreement of up to $25 million after the Business Combination. Abri has also agreed to include
in the Proxy Statement the recommendation of its board that its stockholders approve all of the proposals to be presented at the special
meeting.
Non-Solicitation Restrictions
DLQ Parent and DLQ have each
agreed that from the date of the Merger Agreement until the Closing Date or, if earlier, the valid termination of the Merger Agreement
in accordance with its terms, it will not initiate, encourage or engage in any negotiations with any party relating to an Alternative
Transaction (as defined in the Merger Agreement), take any action intended to facilitate an Alternative Transaction or approve, recommend
or enter into any agreement relating to an Alternative Transaction.
Conditions to Closing
The
consummation of the Merger is conditioned upon, among other things, (i) the absence of any applicable (A) law or order, or (B) Action
(as defined in the Merger Agreement) commenced or asserted in writing by any Authority (as defined in the Merger Agreement), prohibiting
or, in the case of clause (B), materially restrict the consummation of the Merger and related transactions; (ii) receipt
of any consent, approval or authorization required by any Authority (as defined in the Merger Agreement); (iii) approval by DLQ Parent’s
and DLQ’s stockholders of the Merger and related transactions; (iv) approval by Abri’s stockholders of the Merger and
related transactions; (v) the Distribution of the Dividend Shares (as such term is defined in the Merger Agreement) shall be, in
all respects, ready to be consummated contemporaneously with the Merger; (vi) the conditional approval for listing by the Nasdaq
Stock Market of the shares of Abri Common Stock to be issued in connection with the transactions contemplated by the Merger Agreement
and the Additional Agreements and satisfaction of initial and continued listing requirements; and (vii) the Form S-4 becoming
effective in accordance with the provisions of the Securities Act of 1933, as amended (“Securities Act”).
The condition for DLQ Parent to transfer all of the Intellectual Property assets of Rebel AI, Inc. and all of the Intellectual Property
Assets of Fixel AI, Inc. to DLQ, (each a “Sister Company”) has been removed.
Solely
with respect to Abri and Merger Sub, the consummation of the Merger is conditioned upon, among other things: (i) DLQ having duly
performed or complied with all of its obligations under the Merger Agreement in all material respects; (ii) the representations and
warranties of DLQ, being true and correct in all material respects; (iii) no event having occurred that would result in a Material
Adverse Effect on DLQ or any of its subsidiaries; (iv) providing a certificate from the chief executive officer as to the accuracy
of these conditions; (v) shall have obtained certain Company Group Consents (as such term is defined in the Merger Agreement); (vi) DLQ
shall have filed all income Tax Returns for the 2019, 2020 and 2021 tax years and paid all taxes with respect to such tax years
(including penalties and interest, if any).
Solely
with respect to DLQ, the consummation of the Merger is conditioned upon, among other things: (i) Abri and Merger Sub having duly
performed or complied with all of their respective obligations under the Merger Agreement in all material respects; (ii) the representations
and warranties of Abri as set forth in the Merger Agreement that are qualified as to materiality being true in all respects and the representations
and warranties as set forth in the Merger Agreement that are not so qualified, being true and correct in all material respects; (iii);
no event having occurred that would result in a Material Adverse Effect on Abri or Merger Sub; (iv) Abri, Abri Ventures I, LLC
(the “Sponsor”), and any other security holder of Abri, shall have executed and delivered to DLQ each Additional
Agreement to which they each are a party; (v) Abri and Merger Sub having each delivered certain certificates to DLQ; (vi) Abri
having filed its Amended Parent Charter (as defined in the Merger Agreement) and such Amended Parent Charter being declared effective
by, the Delaware Secretary of State; (vii) Abri having delivered executed resignation of the Abri directors and officers as set forth
in the Merger Agreement; (viii) after the redemption by all stockholders of Abri who have elected to redeem their shares of Abri,
Abri shall have made all necessary and appropriate arrangements with the Trustee to have all of the remaining funds contained in the Trust
Account, and all such funds released from the Trust Account shall be available to Abri.
Termination
The Merger Agreement may be terminated
as follows:
| (i) | by either Abri or DLQ, without liability to the other party, if (A) the Merger and related transactions
are not consummated on or before February 12, 2023 (the “Outside Closing Date”), and (B) the material
breach or violation of any representation, warranty, covenant or obligation under the Merger Agreement by the party seeking to terminate
the Merger Agreement was not the cause of, or resulted in, the failure of the Closing to occur on or before the Outside Closing Date.
Such right may be exercised by Abri or DLQ, as the case may be, giving written notice to the other at any time after the Outside Closing
Date; |
| (ii) | by either Abri or DLQ if any Authority (as defined in the Merger Agreement) has issued any final decree,
order, judgment, award, injunction, rule or consent or enacted any law, having the effect of permanently enjoining or prohibiting the
consummation of the Merger; |
| (iii) | by Abri in the event that DLQ does not deliver to Abri the Company Group Financial Statements on or prior
to October 15, 2022, as defined in the Merger Agreement; |
| (iv) | by mutual written consent of Abri and DLQ duly authorized by each of their respective boards of directors; |
| (v) | by Abri in the event that the Board of Directors of Abri, in exercising its fiduciary duties, determines
that the Business Combination is no longer in the best interests of the stockholders of Abri; |
| (vi) | by Abri or DLQ if, at the Abri Stockholder Meeting (including any postponements or adjournments thereof),
the Required Parent Proposals (as described in the Merger Agreement) shall fail to be approved by the affirmative vote of Abri stockholders
required under Abri’s organizational documents and applicable Law or if, at the DLQ Parent Stockholder Meeting (including any postponements
or adjournments thereof), the DLQ Parent Stockholder Approval shall fail to be approved by the affirmative vote of DLQ Parent stockholders
required under DLQ Parent’s organizational documents and applicable Law. |
| (vii) | by either Abri or DLQ, if the other party has breached any of its covenants or representations and warranties
such that it would be impossible or would reasonably be expected to be impossible to satisfy any of its closing conditions and such breach
is incapable of being cured or is not cured by the earlier of (A) the Outside Closing Date and (B) 30 days following receipt
by the breaching party of a written notice of the breach or suffered a Material Adverse Effect which is incurable and continuing; provided
that the terminating party is not then in breach of the Merger Agreement so as to prevent the satisfaction of its closing conditions; |
Effect of Termination
If the Merger Agreement is terminated
in accordance with its terms, the Merger Agreement will become void and of no further force and effect without liability of any party,
except for liability arising out of any party’s willful breach of the Merger Agreement or intentional fraud.
Certain Related Agreements
Parent Stockholder Support Agreement
In connection with the execution of the
Merger Agreement, Abri, and a certain stockholder of Abri entered into that certain Parent Stockholder Support Agreement dated September 9,
2022 (the “Parent Stockholder Support Agreement”) pursuant to which that certain Abri stockholder agreed to
vote all shares of Abri Common Stock beneficially owned by them, including any additional shares of Abri they acquire ownership of or
the power to vote in favor of the Parent Proposals (as defined in the Merger Agreement), including the Merger and related transactions
and against any action reasonably expected to impede, delay or materially and adversely affect the Merger and related transactions.
Agreements to be Executed at Closing
DLQ Management Earnout Agreement
In connection with the execution of the
Merger Agreement, Abri and certain members of DLQ management will enter into a management earnout agreement (the “Management
Earnout Agreement”), pursuant to which certain members of the management team of DLQ specified on Schedule A to the
Management Earnout Agreement (the “Management”) will have the contingent right to earn up to 2,000,000 shares
of Abri Common Stock (“Management Earnout Shares”). The release of the Management Earnout Shares shall occur
as follows:
| · | 500,000 Management Earnout Shares will be earned and
released upon satisfaction of the First Milestone Event (as defined in the Management Earnout Agreement); |
| · | 650,000 Management Earnout Shares will be earned and
released upon satisfaction of the Second Milestone Event (as defined in the Management Earnout Agreement); and |
| · | 850,000 Management Earnout Shares will be earned and
released upon satisfaction of the Third Milestone Event (as defined in the Management Earnout Agreement). |
Sponsor Earnout Agreement
In connection with the execution of the
Merger Agreement, Abri and the Sponsor will enter into a sponsor earnout agreement (the “Sponsor Earnout Agreement”),
pursuant to which the Sponsor will have the contingent right to earn the Sponsor Earnout Shares (as defined in the Sponsor Earnout Agreement).
The Sponsor Earnout Shares consist of 1,000,000 shares of Abri Common Stock. The release of the Sponsor Earnout Shares shall occur as
follows:
| · | 250,000 Sponsor Earnout Shares will be earned and released
upon satisfaction of the First Milestone Event (as defined in the Sponsor Earnout Agreement); |
| · | 350,000 Sponsor Earnout Shares will be earned and released
upon satisfaction of the Second Milestone Event (as defined in the Sponsor Earnout Agreement); and |
| · | 400,000 Sponsor Earnout Shares will be earned and released
upon satisfaction of the Third Milestone Event (as defined in the Sponsor Earnout Agreement). |
Lock-Up Agreement
In connection with the execution of the
Merger Agreement, Abri and DLQ Parent will enter into a lock-up agreement (the “Lock-Up Agreement”), pursuant
to which DLQ Parent will agree, subject to certain customary exceptions, not to (i) sell, offer to sell, contract or agree to sell,
pledge or otherwise dispose of, directly or indirectly, seventy five percent (75%) of the shares of Abri Common Stock held by them as
part of the Merger Consideration, which shares do not include the Dividend Shares, (such shares, together with any securities convertible
into or exchangeable for or representing the rights to receive shares of Common Stock if any, acquired during the Lock-Up Period (as defined
below), the “Lock-Up Shares”), (ii) enter into a transaction that would have the same effect, (iii) enter
into any swap, hedge or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership
of the Lock-Up Shares or otherwise, or engage in any short sales or other arrangement with respect to the Lock-Up Shares or (iv) publicly
announce any intention to effect any transaction specified in clause (i) or (ii) until the date that is 11 months after
the Closing Date (the period from the date of the Lock-Up Agreement until such date, the “Lock-Up Period”).
DLQ will also cause certain members of its management to enter into a Lock-up Agreement concerning shares of Abri Common Stock they will
own.
Amended and Restated Registration Rights Agreement
At Closing, Abri, the Sponsor and Chardan
Capital Markets, LLC as underwriter (the “Underwriter”) will enter into an amended and restated registration
rights agreement (the “Amended and Restated Registration Rights Agreement”), pursuant to which the Sponsor,
the Underwriter and holders of the Lock-Up Shares and recipients of the Management Earnout Shares and Sponsor Earnout Shares, if any,
will be provided certain rights relating to the registration of certain Abri securities.
Voting Agreement
In connection with the execution of the
Merger Agreement, Abri, the Sponsor and certain holders of Abri Common Stock (as identified in the Voting Agreement) will enter into a
voting agreement (the “Voting Agreement”), pursuant to which such holders of Abri Common Stock agree to vote
in favor of certain matters relating to the nomination and election of the Post-Closing Board of Directors (as described in the Voting
Agreement).
Warrant Revenue Sharing Side Letter
In connection with the execution of the
Merger Agreement, Abri, DLQ and the Sponsor will enter into a letter agreement (the “Warrant Revenue Sharing Side Letter”),
pursuant to which Abri and DLQ will divide the proceeds from the Warrant Exercise Price (as defined in the Warrant Revenue Sharing Side
Letter), arising from the exercise of the warrants issued as part of the Abri Units sold in its initial public offering whereby twenty
percent (20%) of the Warrant Exercise Price received in cash by Abri shall be delivered to the Sponsor in cash or immediately available
funds not later than three (3) days following Abri’s receipt of the cash exercise price of any Warrant.
Effective as of the Closing, the Combined
Company’s board of directors will have five (5) directors. The Sponsor has the right to designate three (3) directors.
DLQ has the right to designate two (2) directors who shall include the sole member of DLQ’s board of directors before Closing.
At the Closing, all of the executive officers of Abri shall resign and the individuals serving as executive officers of the Combined Company
immediately after the Closing will be Brent Suen as Chief Executive Officer, John MacNeil as Chief Operating Officer, and Robb Billy as
Chief Financial Officer.
See “Directors, Executive Officers,
Executive Compensation and Corporate Governance — Directors and Executive Officers after the Business Combination”
for additional information.
Business Combination Extension
On August 5,
2022, Abri deposited $573,392 into the Trust Account to extend the time to complete a Business Combination until November 12, 2022.
On November 1, 2022, Abri deposited $573,392 into the Trust Account for the second of two three-month extensions to extend the
time to complete a Business Combination until February 12, 2023.
At the Extension
Meeting of Abri’s stockholders held on December 9, 2022, Abri’s stockholders approved (i) a proposal to amend Abri’s
amended and restated certificate of incorporation, and (ii) a proposal to amend the Management Trust Agreement with the Transfer
Agent, to extend the date by which Abri has to consummate a business combination from February 12, 2023 until August 12, 2023,
on an as needed, month-to-month basis, by depositing an additional $87,500 into the Trust Account for a one-month extension.
On February 6, 2023, March 10, 2023, April 11, 2023, May 11, 2023, June 9, 2023 and July 10, 2023, Abri deposited
$87,500 into the Trust Account for each one-month extension (or a total of $525,000), to extend the time to complete a business combination
to August 12, 2023. If Abri’s initial business combination is not consummated by August 12, 2023, then Abri’s existence will
terminate Abri has deposited an aggregate of $525,000 into the Trust Account for all of the six extensions.
On August 7, 2023, Abri held a
second special meeting of shareholders (the “Second Extension Meeting”) In connection with Abri’s Second
Extension Meeting, the stockholders approved a proposal to extend the date to complete a business combination to February 12, 2024 and
to remove the net tangible asset provision in the charter, a total of 570,224 shares were tendered for redemption.
In connection with the Second Extension
Meeting, 570,224 shares were tendered for redemption. As a result, approximately $6.05 million (approximately $10.62 per share), after
deducting allowable taxes, will be removed from Abri’s trust account to pay such holders. Following redemptions, Abri has 682,148
public shares of common stock outstanding.
Abri’s Business and Background of the Business Combination
Abri is a blank check company incorporated
in Delaware on March 18, 2021. Abri was formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase,
reorganization or similar business combination with one or more businesses or entities. On August 12, 2021, Abri consummated its
IPO of 5,000,000 Units, each Unit consisting of one share of Common Stock, one Warrant entitling the holder thereof to purchase one-half
of a share of Common Stock at a price of $11.50 per whole share, as described in more detail in this proxy statement. The Units were
sold at a price of $10.00 per Unit, generating gross proceeds to Abri of $50,000,000. On August 23, 2021, the Underwriters exercised
the over-allotment option in full and Abri sold 733,920 Over-Allotment Option Units at a price of $10.00 per unit, generating additional
gross proceeds of $7,339,200. Simultaneously with the consummation of the IPO, we consummated the Private Placement with the Sponsor of
276,250 Private Units at a price of $10.00 per Private Unit, generating total proceeds of $2,762,500. The Private Units are
identical to the Units sold in the IPO, except as otherwise disclosed in the Registration Statement. On August 23, 2021, Abri
consummated the sale of an additional 18,348 Private Units generating additional gross proceeds of $183,480.
After deducting the underwriting fee (excluding
the deferred underwriting commission of $, which amount will be payable upon consummation of the Business Combination, if consummated)
and the IPO expenses, the total net proceeds from Abri’s IPO and the sale of the Private Units, approximately $57.3 million
(or $10.00 per Unit sold), was placed in the Trust Account.
Prior to the consummation of its IPO,
neither Abri nor anyone on its behalf, contacted any prospective target business or had any substantive discussions, formal or otherwise,
with respect to such a transaction with Abri.
After the closing of its IPO, the officers
and directors of Abri continued to correspond with Chardan Capital Markets, LLC (“Chardan”), its IPO underwriter,
and in mid-August 2021, commenced an active, targeted search for an initial set of potential business combination targets, leveraging
their network of relationships. Specifically, the directors and officers focused Fintech/InsurTech companies with unique market positioning,
disruptive value proposition, reasonable barrier to competition entry, growth industry and in need of growth capital, strong management
team, among others and initiated contact with and were approached by several potential targets and/or advisors, including Chardan.
Of these potential targets, Abri entered
into non-disclosure agreements with several targets, but after initial review of the different company data rooms, decided to focus its
due diligence efforts on Target A, Target B, Apifiny Inc. and DLQ, and conducted additional due diligence and/or detailed discussions
with all companies.
Target A was a company specializing in
“providing white-label embedded services for US-based financial institutions.” Abri officers conducted due diligence over
August 2021 to October 2021 period, doing business and segment overview, financial analysis, site visit, human resources, among
others. While the company demonstrated excellent potential for growth and benefitting from access to capital markets, after completing
due diligence, management reached the conclusion that a business combination with this Target would not work because the company was not
public ready and doing so would likely extend beyond the SPAC’s transaction time horizon and ultimately decided not to proceed with
this target company.
Target B was a company specializing in
“providing embedded travel and warranty insurance on a global basis in conjunction with the airline, car rental and on-line retailer
industries.” Abri officers conducted due diligence over August 2021 to October 2021 period, doing business and segment
overview, financial analysis, human resources, among others. While the company demonstrated excellent potential for growth and benefitting
from access to capital markets, after completing due diligence, management reached the conclusion that a business combination with this
Target would not work because the company was in the middle of a complex strategic investment round that would likely not meet the SPAC’s
transaction time horizon, and ultimately management decided not to proceed with this target company.
Prior Merger Discussions with Apifiny Inc.
On September 21, 2021, Abri entered
into an agreement with Chardan to act as Abri’s non-exclusive financial advisor for the purpose of assisting Abri in evaluating
several potential acquisition targets, including Apifiny Inc., a crypto currency and mining company. On October 4, 2021, Chardan
contacted Abri to gauge Abri’s interest in evaluating a potential business combination with Apifiny Inc. Negotiations continued
through January 2022. On January 27, 2022, Abri, Abri Merger Sub, Inc., a Delaware corporation and a wholly-owned subsidiary
of Abri (“Merger Sub”), Apifiny Inc., and the Sponsor (collectively, the “Apifiny Merger Parties”),
signed a merger agreement, where Merger Sub would merge with Apifiny Inc., and Apifiny Inc. would be the surviving corporation in a “reverse
triangular merger” transaction (the “Apifiny Merger Agreement”).
On July 22, 2022, the Apifiny Merger
Parties entered into a termination of merger letter agreement (the “Merger Termination Agreement”). Pursuant
to the Merger Termination Agreement, the Apifiny Merger Parties agreed to mutually terminate the Apifiny Merger Agreement, subject to
the representations, warranties, conditions and covenants set forth in the Merger Termination Agreement. All Additional Agreements (as
defined in the Apifiny Merger Agreement) (including the Parent and Company Stockholder Support Agreements) have also been terminated in
accordance with their respective terms as of July 22, 2022, the Apifiny Merger Agreement Termination Date.
Background of the proposed Business Combination
with DLQ
In October 2021,
Jeffrey Tirman had an introductory meeting in New York with Brent Suen, the Chief Executive Officer of DLQ and discussed DLQ’s
business operations and financial needs. The meeting was initiated by Mr. Tirman after seeing Mr. Suen at a dinner gathering.
Mr. Tirman and Mr. Suen knew each other as children in the early 1970’s through their fathers, who worked as doctors at
the same university hospital in Little Rock, Arkansas. Since then and up until October 2021 when Mr. Tirman and Mr. Suen were
reintroduced, there had been no interaction or relationship of any kind whatsoever between Mr. Tirman and Mr. Suen. At that
meeting, they explored the generalities of a de-SPAC transaction and the processes related thereto. No action to proceed with a business
combination was taken at that time, and Abri moved forward with Apifiny.
On July 26,
2022, after terminating the merger with Apifiny, Mr. Tirman re-engaged with Mr. Suen to determine if DLQ was still interested
in pursuing a deSPAC transaction, and to get an update on business developments and operations. Over the next 2 days the parties
had preliminary discussions regarding possible transaction terms, valuation, structure of the transaction timing of audits, diligence
matters, length of any exclusivity period, and possible filing timelines.
On July 28,
2022, based on discussions over the previous 2 days, Mr. Tirman delivered a Non-Disclosure Agreement and an initial draft
letter of intent to DLQ. The initial letter of intent represented the discussions between the parties.
The initial letter
of intent was prepared by Abri and reflected the amount of earnout shares to be distributed to DLQ management and to the Sponsor under
specific circumstances, a warrant revenue sharing arrangement where 20% of the gross proceeds to be paid to the Sponsor in the event that
the warrants are exercised at a price of $16.50 per share. These terms were not negotiated further. The initial letter of intent also
included a tentative valuation of $140 million, which was proposed by DLQ, subject to further due diligence and discussions about
the presented projections. That valuation was subsequently adjusted to $114 million over the next few days.
On July 29,
2022, Mr. Tirman and Mr. Suen further discussed the Letter of Intent and potential transaction terms. The main focus was on
the potential valuation and the parties agreed that 3.5-5.0 times estimated current revenue was a fair preliminary valuation pending due
diligence and further confirmatory financial analysis. There was also continued discussion on audit timing. The parties also discussed
exclusivity and the fact that Abri would not be exclusive but that DLQ needed to agree to exclusivity. Abri believed that this was in
its best interest given the limited life on the SPAC and that we had already consumed significant time on the prior transaction that was
not ultimately consummated.
On July 30,
2022, the Non-Disclosure Agreement was executed. Discussions continued regarding merger consideration structure, lock-up periods
and NASDAQ listing requirements. General terms for the Letter of Intent were verbally agreed, which included an original target valuation
was of $140 million based on a precursory look at preliminary data and comparable public companies which were generated by Factset
and had been provided to DLQ the previous year. In addition, the initial proposal for the five directors of the combined company was to
include two directors being appointed by Abri appointing DLQ would appoint three directors. The parties also discussed that the initial
parent lock-up would be for 12 months following the business combination.
On July 30,
2022, a further revised draft of the Letter of Intent was delivered by Mr. Tirman to Mr. Suen. The revisions changed the composition
of the board whereby Abri would appoint three directors and DLQ would appoint two directors. Abri believed that their board nominees are
very experienced and would benefit post-merger public stockholders. In addition, several companies with similar business criteria
were reviewed and in light of some of those criteria, the valuation range was lowered to between $122 and $144 million. The valuation
was adjusted lower to reflect the specific criteria of DLQ relative to these comparable companies, whereby Abri would acquire 100% of
the outstanding equity securities of DLQ at the value of $114,000,000. There was no discussion about the need to raise additional capital
at that time, and the valuation did not include any future financing from the Sponsor, including the possible up to $25 million financing
after the close of the Business Combination. The parties also agreed to lower the parent lock-up period from 12 to 11 months.
With these updated terms, the Letter of Intent was revised and executed the same day. Please see “Basis For Evaluation”
below.
After the signing
of the Letter of Intent, and subsequently through discussions of terms in the Merger Agreement, both the Sponsor and DLQ observed developments
in the SPAC market in the United States leading to high levels of redemptions in connection with the closing of business combinations.
This initiated discussions about the possibility of the Combined Company needing financing after the closing of the Business Combination.
Over the next
few weeks, during the due diligence process and finalizing the other terms of the Merger Agreement and related documents, as further described
below, the Sponsor, Abri and DLQ held several discussions about the possible need for additional capital, and the Sponsor proposed to
extend up to $25 million in post-closing financing to the Combined Company. The general terms agreed were: i) the financing
amount would be up to $25 million, ii) the Sponsor or one of its affiliated entities would have the right to raise up to that $25 million,
and iii) the overall structure would be a line of credit or similar draw-down instrument. The specific terms of the overall structure
were not finalized during those discussions.
During the week
of August 1, 2022, the parties commenced the due diligence process and DLQ began to populate a virtual dataroom.
On August 7,
2022, the parties held an initial due diligence call with counsel. Also, on such date, Abri and its counsel were given access to the virtual
dataroom to commence due diligence.
Throughout August
and early September 2022, Abri and its advisors conducted additional due diligence review of a prospective Business Combination with
DLQ. More specifically, the due diligence questions Abri asked related to, and the corresponding materials it requested included,
corporate records, stockholder information, a history of securities issuances by DLQ, financing documents, material contracts, management
and employees, financial information, sales and marketing, real property, intellectual property, IT systems and networks, privacy and
data security, environmental matters, governmental regulations and filing, litigation and audits, insurance policies and claims, tax returns
and related records, and other miscellaneous items.
On August 8,
2022, Chris Hardt, Abri’s Chief Financial Officer, visited the DLQ offices in Minneapolis and had an in-person meeting with
members of DLQ management.
Also, on August 8,
2022, counsel for Abri and DLQ had a call to discuss the structure of the transaction and the possible dividend of a portion of the consideration
to the stockholders of DLQ’s parent. The parties also discussed the structuring of the transfer of certain intellectual property
assets owned by sister entities of DLQ. Finally, the parties discussed the status of the audit of the financials that would be required
for the financial statements.
During the week
of August 8, 2022, the parties continued discussions regarding structuring the transaction and continued to perform due diligence.
Further discussions
about the need for financing after the closing of the Business Combination were held between the Sponsor, DLQ and Abri management, and
that the merger agreement would provide that the parties would enter into a senior financing facility, or similar structure, whereby the
Sponsor would serve as the exclusive financing source for the Combined Company after the closing of the Business Combination for up to
$25 million.
During the week
of August 15, 2022, Loeb and Loeb, LLP, Abri’s legal counsel (“L&L”) prepared the Merger Agreement
and circulated an initial draft of the Merger Agreement on August 21, 2022. The Merger Agreement reflected substantially all of the
terms contained in the Letter of Intent except that initially Abri was to only retain two (2) directors and DLQ would have a right
to appoint 3 directors. In the initial draft, the number of directors was revised so that Abri would retain three (3) directors and DLQ
would have a right to appoint two (2) additional directors. In addition the specific structure of the acquisition was not set forth in
detail in the Letter of Intent. Between the signing of the Letter of Intent and the circulation of the initial draft of the Merger Agreement,
the parties discussed the structure with tax and legal professionals and finalized a structure through which DLQ would first acquire the
assets of Fixel AI, Inc. and Rebel AI, Inc. and, subsequent to such acquisition, a subsidiary of Abri would merge with DLQ. The structure
also contemplated that 25% of the shares constituting the purchase price would be distributed to the stockholders of DLQ Parent as a dividend.
In addition, the initial draft of the Merger Agreement included indemnification from DLQ Parent for breaches of representations, warranties
and covenants and included a share escrow of five (5%) percent of the purchase price to satisfy any indemnification claims.
On August 25,
2022 L&L also circulated updated representations and warranties with respect to data privacy.
On August 26,
2022, DLQ’s legal counsel, Procopio, Cory, Hargreaves & Savitch LLP (“PCHS”) circulated comments
to the Merger Agreement. The revised draft clarified that the assets and not the equity of Rebel AI, Inc. and Fixel AI, Inc. would be
contributed to DLQ prior to the closing. The revised draft also included a board of seven (7) directors of which Abri would appoint
four (4) directors. The representations and warranties of DLQ were revised so that exceptions to the representations contained in the
SEC filings of DLQ Parent did not need to be separately scheduled in the disclosure schedules. The revised draft also included knowledge
qualifiers and certain other clarifying revisions to the representations and warranties of DLQ, and increased representations and warranties
for Abri including ones related to compliance with laws, employment matters, and Investment Company Act matters. DLQ also updated the
revised draft to provide for reciprocity of the exclusivity provisions; the adoption of an equity incentive plan for Abri; the inclusion
of a fiduciary out; reduction the lock-up period to 9 months and inclusion of a lock-up period for the shares owned by
the Sponsor; deletion of the senior financing facility and deletion of the indemnification provisions. In addition, DLQ revised the governing
law from Delaware to New York.
On August 31,
2022, L&L circulated certain ancillary documents to PCHS for review.
On September 1,
2022, L&L circulated a further revised draft Merger Agreement. The revised document made further changes to the intellectual property
and data privacy representations and certain other representations of DLQ. Abri also refused to include any lock-up provisions with
respect to the sponsor shares and removed such provisions from the draft. Abri further amended the DLQ lock-up period to 11 months.
Abri also required that the provisions with respect to the board of directors reverted back to the prior provisions, including a board
of five (5) directors, three of which would be appointed by Abri. The agreement was also revised in order to lower the dollar thresholds
for the conduct of the business prior to closing. In addition, the draft removed he exclusivity provisions for Abri and added back the
provisions with respect to the senior financing facility. In addition, the choice of law was changed back to Delaware. Finally, Abri agreed
to delete the indemnification provisions contained in the initial draft.
On September 2,
2022, PCHS circulated an initial draft of the disclosure schedules to the Merger Agreement.
On
September 2, 2022 PCHS also circulated a further revised draft of the Merger Agreement in order to respond to the comments from September 1,
2022. This draft inserted the fiduciary out for DLQ, to revise the term for the lockup and make certain other change to the representations.
DLQ and Abri had a call on September 3rd and
as result of the call, PCHS circulated a revised draft of the Merger Agreement on September 3, 2022 removing the fiduciary out provisions.
Between September 3,
2022 through the signing of the Merger Agreement on September 9, 2022, L&L and PCHS exchanged drafts of the Merger Agreement
which included updates and revisions to the representations and warranties of the parties. The parties also revised and prepared final
drafts of the ancillary documents, including the Parent Support agreement, the Sponsor Earnout Agreement, the Management Earnout Agreement,
the Voting Agreement and the Warrant Revenue Sharing Side Letter, the proposed amendments to the post-merger company’s bylaws
and certificate of incorporation, and finalized the disclosure schedules to the Merger Agreement. The terms of such ancillary documents
did not change materially from those circulated in the Letter of Intent.
The specific
terms of the overall structure for the possible financing of the Combined Company were still not finalized, so the parties agreed to leave
the provision as it was in the original draft of the merger agreement, where the Sponsor would be the exclusive financing source after
the Business Combination to raise financing up to $25 million. To date, the terms of any such financing have not yet been agreed
and will be finalized at, or immediately subsequent to, the Closing of the business combination.
The business
combination was presented at a meeting of the board of directors of Abri, where all board members attended. Although Mr. Tirman has
known Mr. Suen for many years, there has never been a business relationship between them. Mr. Tirman explained the merits of
the transactions and the reasons, as presented below, to consider in making a decision to move forward with DLQ for the business combination.
Since there is no business relationship between the management of Abri or the management of DLQ, the management believed that there is
no conflict of interest in presenting this business opportunity to the board of directors. After careful consideration of the terms and
conditions of the Merger Agreement, Abri’s board of directors determined that Business Combination and the transactions contemplated
thereby are fair to, and in the best interests of, Abri and its stockholders. On September 8, 2022, at a virtual, meeting where all
members of the board of directors of Abri were present, the Definitive Merger Agreement was unanimously approved.
On September 9,
2022, the parties signed the Definitive Merger Agreement.
On October
31, 2022, pursuant to an agreement between Abri and Chardan, the underwriter of the IPO, Chardan agreed to provide certain financial
advisory services to Abri in connection with the business combination with DLQ and upon closing of the Business Combination, Chardan
will receive 30,000 shares of Common Stock. This is in addition to the deferred underwriting fee of $1,500,000 that Chardan will
receive as a result of the Business Combination pursuant to the Underwriting Agreement dated August 9, 2021 in connection with Ari’s
IPO.
On October 11,
2022, Abri SPAC I, Inc. engaged The Mentor Group, Inc. to serve as an independent financial advisor for the benefit of the Board in connection
with the consideration by the Board of the Merger between Abri an DLQ.
To raise additional proceeds to fund the
Business Combination and closing costs, Abri was contemplating a private placement transaction for a minimum commitment of $4,555,231
(a “PIPE Investment”). Proceeds from the PIPE Investment will be used to pay certain fees and expenses in connection
with the Business Combination, including closing costs and the deferred underwriter’s fee and working capital, and the expectation
was to do a private placement to close immediately prior to or simultaneously with the closing of the Business Combination, for a minimum
of $4,555,231. To the extent not utilized to consummate the Business Combination, the proceeds from the Trust Account after redemptions
will be used for general corporate purposes, including, but not limited to, working capital for operations, capital expenditures and future
acquisitions.
During the first quarter 2023,
due to working capital constraints, DLQ revenue from lead generation declined, which would impact revenue for the remainder of the year.
In addition, DLQ incurred additional expenses buying ads as a result of lower sales. DLQ signed a new MSA for Affiliation Management services
which offset some of the loss in revenue, but operating costs relative to sales was higher. This was largely driven by a reduction of
working capital available that reduced the ability to place ads on behalf of clients. While DLQ was able to reduce total operating expenses,
it was not enough to offset the reduction in sales. For these reasons, DLQ recalculated forecasts for 2024 to take into account the actual
results from operations to adjust for the changes in business conditions. These forecasts are reflected below.
In May of 2023, Abri and the Sponsor
began discussing the financial needs of the Company post-business combination as contemplated by the parties when they signed the Merger
Agreement, where they included that the Sponsor would serve as the exclusive financing source for the Combined Company after the closing
of the Business Combination for up to $25 million. The parties discussed the need to possibly increase the amount to $30 million.
On June 8, 2023 Abri, Abri Sub,
DLQ Parent, and DLQ entered into an amendment to the Merger Agreement to (i) amend the exchange on which its securities can be listed
in connection with the Business Combination to include being listed on Nasdaq Global Market, and (ii) waive any default of Section 9.1(i)
of the Merger Agreement for having received the MVLS Notice from Nasdaq.
In its continued due diligence
of the potential acquisition of the intellectual property relating to the Fixel’s MarTech Audience Targeting Platform and the Rebel
SMB marketing prior to the Closing of the Business Combination, DLQ concluded that due to the complexities related to the IP transfers
and the negligible independent value of such assets, these platforms no longer make financial sense and no longer complement their business
model.
In June, 2023 the parties agreed
that the name of the Combined Company after the Closing of the Business Combination would be Collective Audience. The parties concluded
this would be a simpler solution to separate any association of confusion with DLQ Parent, “Logiq, Inc.”
After several discussions in June,
2023, Abri agreed to release DLQ from its obligation to complete these acquisitions and signed Amendment No. 3 into the Merger Agreement
in order to release DLQ from its obligation to complete the acquisition of the Sister Company assets, and to change the name of the Combined
Company to Collective Audience, Inc.
Beginning in July 2023, Abri and
the Sponsor began discussions with third party investors in connection with putting an ELOC in place at the Closing of the Business Combination.
The parties decided that the amount of the ELOC or any other form of financing should be increased, and the maximum amount of funds to
be sourced by the Sponsor should be $30 million. Abri and the Sponsor discontinued discussions of a PIPE investment in furthering discussions
relating to the possibility of arranging financing through an ELOC instead.
The terms of an ELOC were discussed
whereby if an ELOC were to be in place, it would allow for the purchase shares of Common Stock of the Company from time to time in a minimum
amount not less than $50,000 and up to of $500,000 depending on daily trading volume and the market price of the Common Stock. Terms and
third party investors have not yet been confirmed and the Sponsor will continue to have discussions with investors to come to an arrangement
at the Closing of the Business Combination.
As consideration for their assistance
in securing a financial commitment, the Company may issue to the Sponsor 50,000 shares of common stock on the date on which a definitive
agreement is entered into with a third party investor, possibly in the form of an ELOC.
On July 20, 2023 Abri, Abri Sub,
DLQ Parent, and DLQ entered into an amendment to the Merger Agreement to (i) remove provisions related to the transfer of certain intellectual
property assets of Fixel AI, Inc. and Rebel AI, Inc., which were deemed to have negligible independent value, (ii) change the name of
the Surviving Corporation to “Collective Audience, Inc.” and (iii) increase the size of the senior financing facility from
$25 million to $30 million.
In May 2023 DLQ management began
discussions with certain investors interested in investment opportunities in their industry. The discussions were focused on the amount
needed to cover closing costs of the Business Combination and possibly doing an investment in DLQ before the Business Combination. The
amount would not overlap with the Combined Company’s financing arrangements if the Company enters onto an investment arrangement,
which will only be secured at the time of the Business Combination if market conditions at that time are favorable.
During the months of June and July,
DLQ began discussions with Chardan whereby an institutional investor would purchase shares of DLQ before the Closing of the Business Combination
which shares would be registered as part of the Merger Consideration at the Closing. The shares of DLQ would convert into shares of Abri
Common Stock assuming a share price of $10.00 per share. This private placement investment would be in lieu of a PIPE Investment. The
Sponsor, DLQ management and Abri management concluded that an investment in the form of a PIPE or an ELOC was not in the best interest
of the Combined Company due to difficulty in sourcing an investment under current market conditions, and instead DLQ management would
focus on securing an investment into DLQ directly, therefore being included as part of the 11,400,000 Merger Consideration Shares.
During the early weeks in
August 2023, DLQ had conversations with institutional investors to invest directly into DLQ in the form of a $5 million private
placement. The parties agreed to an investment into DLQ in the form of a $5 million convertible promissory note which would convert
into shares of common stock of DLQ prior to the Closing of the Business Combination, and would then be exchanged for 1,600,000 out of
the 11,400,000 Merger Consideration Shares at the Closing of the Business Combination.
Discussions for alternative financings
by way of a PIPE or an ELOC were discontinued in light of the fact that DLQ was securing an alternative source of financing directly,
which funds would be available at the Closing of the Business Combination. Due to unfavorable market conditions, both management teams
concluded that the Combined Company would be better off raising capital after the Business Combination on an as needed basis, through
the Sponsor as was originally contemplated.
Furthermore, the Sponsor and the
management teams of both Abri and DLQ reviewed options of financing through an ELOC and concluded that this form of financing could result
in deeper dilution to the public shareholders, which would not be in their best interest, and this in turn would make it more difficult
to raise capital for the Combined Company. They decided not to pursue an ELOC as a financing option.
During the week of August 14,
2023, terms for an investment into DLQ were discussed where certain institutional investors would invest $5 million into DLQ through
a convertible promissory note prior to the Business Combination. The promissory notes would convert into shares of common stock of DLQ
immediately before the Closing of the Business Combination in order to be included in the shares of common stock of DLQ that would be
exchanged for 11,400,000 Merger Consideration Shares. The investors sought protection of their investment and the parties agreed to escrow
an additional 1,500,000 Merger Consideration Shares out of the remaining 9,800,000 Merger Consideration Shares (the “Reset
Shares”) that were to be issued to DLQ Parent stockholders as part of the 25% Dividend Shares, in order for the investors
to recoup their investment, if necessary.
During the week of August 21, 2023,
DLQ Parent, the Sponsor and the management teams of Abri and DLQ agreed to amend the Merger Agreement to increase the number of shares
issued to DLQ Parent stockholders from 25% of the Merger Consideration Shares (or 2,850,000 shares) to 33% of the Merger Consideration
Shares (or 3,762,000 shares), so that any Reset Shares not issued to investors to recoup their DLQ investment, would be issued as additional
Dividend Shares to the DLQ Parent Stockholders.
On August 31, 2023, Abri entered
into an amendment to the Merger Agreement (the “Fourth Merger Agreement Amendment”) to (i) increase the number
of Dividend Shares to be issued to DLQ Parent stockholders at the Closing of the Business Combination from 25% of the Merger Consideration
Shares to 33% of the Merger Consideration Shares, (ii) distribute 14% of the aggregate Merger Consideration Shares to certain DLQ investors,
and (iii) to ensure 53% of the Merger Consideration Shares will be subject to lock-up.
On September 5, 2023, DLQ entered into
an agreement with the Investors for a $5 million investment in DLQ (the “DLQ Investment”) in the form of convertible
promissory notes issued by DLQ (the “DLQ Notes”). The DLQ Notes shall convert into such number of shares of
common stock of DLQ (the “Conversion Shares”), that would be exchanged for 1,600,000 Merger Consideration Shares
at the Closing. As a condition to the DLQ Investment, the Investors requested an assurance mechanism from DLQ to protect the Investors
in the event they were unable to recoup the full value of the DLQ Investment. DLQ agreed to put the 1,500,000 Reset Shares into escrow,
which shares would be released to the Investors to cover any shortfall of the DLQ Investment, up to the maximum amount of Reset Shares.
After the Closing of the Business Combination, once the Investors recoup the DLQ Investment, any remaining Reset Shares not released to
the Investors, would be distributed to DLQ Parent Stockholders as additional Dividend Shares. In addition, approximately 6 million Merger
Consideration Shares, not distributed to DLQ Parent Stockholders, shall be placed in an escrow account until the DLQ Investment has been
recouped by the Investors, or all the Reset Shares have been released.
The DLQ Investment funds have been
put into an escrow account and shall be released at Closing to pay certain fees and expenses in connection with the Business Combination,
including closing costs including the deferred underwriter’s fee and for working capital. To the extent not utilized to consummate
the Business Combination, the remaining proceeds from the DLQ Investment and the proceeds from the Trust Account after redemptions will
be used for general corporate purposes, including, but not limited to, working capital for operations, capital expenditures and future
acquisitions. Investors have also received a $5 million convertible note issued by DLQ Parent (the “LGIQ Note”),
which shall, at the option of the Investors, convert into such number of shares of Common Stock of DLQ Parent (“LGIQ Shares”)
derived by dividing $5 million by the volume weighted average share price of LGIQ on the day before the date of conversion.
Abri’s Board’s Discussion of Valuation and
Reasons for the Approval of the Business Combination
In evaluating
the transaction with DLQ, the Abri Board consulted with management and Abri’s legal counsel. The board of directors considered and
evaluated several factors, including, but not limited to, the factors discussed below. In light of the number and wide variety of factors
considered in connection with its evaluation of the Business Combination, the board of directors did not assign relative weights to the
specific factors that it considered in reaching its determination and supporting its decision. The board of directors based its decision
on all the information available and the factors presented to and considered by it. In addition, individual directors may have given different
weights to different factors. This explanation of our reasons for the Business Combination and all other information presented in this
section is forward-looking in nature and, therefore, should be read in light of the factors discussed under “Cautionary
Note Regarding Forward-Looking Statements.” Before reaching its decision, the board of directors discussed the
material results of its management’s due diligence activities, which included:
| · | extensive meetings and calls with DLQ’s management
team regarding the company’s products, development plans, operations and projections; |
| · | research on the financial services industry in general
and the technology and software companies, particularly “Software as a Service” (SaaS) and digital content companies (market
size, rapidly changing regulatory environment, among other considerations); |
| · | due diligence activities relating to business, accounting,
legal, tax, financial trading, investing and processing, insurance, operations and other matters; |
| · | financial and valuation analyses including financial
projections provided by DLQ; and |
| · | research on the public trading values of comparable
peer companies. |
The board of
directors considered a number of factors that align with the above metrics pertaining to the Business Combination as generally supporting
its decision to enter into the Merger Agreement and the transactions contemplated thereby, after considering the risks associated with
DLQ’s business, including but not limited to, the following material factors:
| · | DLQ is positioned in Abri’s primary target industries
of financial and technology services, particularly SaaS and digital content providers. |
| · | DLQ has a unique market position with a track record
of growing its platform through acquisition. |
| · | We believe that their platform to market their SaaS
products, their demonstrated growth in a cost effective and transparent manner should enable it to benefit from this growth industry. |
| · | We believe that DLQ, which may need growth capital in
the future, will be able to grow faster with access to capital through continuing its business model as a separate entity from DLQ Parent,
and being public as a separate entity, would articulate its current business model more efficiently. |
| · | At a $114 million transaction valuation, we believe
that this is an attractive valuation relative to its competitors and/or peers. |
| · | DLQ has a strong management team and work force made
of a good mixture of experienced tech talent, and executive with experience with a publicly trading company. |
| · | Abri evaluated risks associated with DLQ being able
to continue to grow through acquisition to expand its software services in addition to complimentary products. Please see “Risk
Factors — Risks Related to DLQ’s Business” on page 50 of this proxy statement. |
Basis for Valuation
After careful
consideration, the board of Logiq recommends that its stockholders vote “FOR” the approval of the Business Combination.
Abri and DLQ
determined that an enterprise valuation in the range of $122 million to $144 million was reasonable, implying a multiple in
the range of 1.7 x to 2.0 x projected revenues for 2023.
Abri independently
selected 16 comparable publicly traded companies which included 8 companies from the list of 9 companies pulled from Factset, and were
able to retrieve some relevant financial data on those companies provided as of August 29, 2022. Abri determined that the most relevant
metric to use in valuing DLQ was a multiple of 2023 projected revenue given that:
| · | DLQ has been making multiple recent acquisitions. The
most recent one was in March 2022, so the (annual) revenue will not cycle through DLQ`s financials until fiscal 2023. |
| · | DLQ was in the process of entering into a Managed Services
Agreement which would have a material impact on revenues going forward, which was subsequently announced on November 8, 2022 on Form 8-K. |
| · | Recent historic revenue is biased downward by several
significant non-recurring events. Specifically, a change in digital advertising rules in the company`s key Medicare vertical which
caused the company to pause and change existing advertising campaigns; and a delay in obtaining working capital financing to support normalized
growth in the company`s core lead generation business. |
| · | A multiple of gross profit is a less relevant metric
for DLQ to determine its enterprise value as the company will only gradually gravitate towards normalized margins, driven by existing
products expected to be drawn into the abovementioned new business contract over time. |
| · | EBITDA multiple is not a relevant metric as the positive
inflection point is only achieved in 2023. We believe DLQ will not be operating at normalized margins in 2023 because we believe that
it will be in the process of integrating recent acquisitions and a large new contract, as well as still being in the early stages of scaling
up. |
By applying the
mean enterprise value/2023 revenue multiple of the comparable publicly traded companies to DLQ`s 2023 projected revenue, an enterprise
valuation of $209 million is implied for DLQ
| | |
2022 | | |
2023 | |
| Comps Mean EV/Rev | |
| 3.5 | | |
| 2.9 | |
| Datalogiq Proj. Rev. ($mill) | |
| 20 | | |
| 72 | |
| Datalogiq Implied Enterprise Value | |
| 70 | | |
| 209 | |
However, DLQ
is expected to have substantially lower revenue, a lower gross margin, and a higher growth rate than the comparable publicly traded companies.
| | |
2023 | |
| | |
Rev | | |
GM | | |
Growth | |
| Comps Mean | |
| 697 | | |
| 64.0 | % | |
| 18.4 | % |
| Comps Median | |
| 490 | | |
| 69.0 | % | |
| 17.6 | % |
| Datalogiq | |
| 72 | | |
| 25 | % | |
| 106 | % |
In order to assess
the impact of revenue size, gross margin, and growth on the enterprise value/2023 revenue multiple, we compared the 2023 mean enterprise
value/2023 revenue multiple for the 3 highest and 3 lowest ranking comparable publicly traded companies by revenue, gross margin, and
growth.
2023 EV/Rev ranked by Rev, GM,
and Growth
| | |
Rev | | |
GM | | |
Growth | |
| Mean 3 lowest 2023 | |
| 1.6 | | |
| 1.2 | | |
| 1.4 | |
| Mean 3 highest 2023 | |
| 8.3 | | |
| 1.2 | | |
| 5.9 | |
This comparison
points to companies with high revenue and growth commanding a higher enterprise value/2023 revenue multiple, while a higher or lower gross
margin does not appear to make a significant difference in the valuation multiple.
In light of the
substantially lower revenue, and higher growth rate versus the publicly traded comparable companies, we believe that DLQ should be valued
at an enterprise value/2023 revenue multiple in the 1.7 to 2.0 times range, resulting in an enterprise valuation in the $122 million
to $144 million range. This represents a substantial discount from the 2.9 times mean multiple of the universe of 16 comparable publicly
traded companies.
| 2023 EV/Rev multiple | |
| 1.6 | | |
| 1.7 | | |
| 2.0 | |
| Datalogiq 2023 Rev | |
| 72 | | |
| 72 | | |
| 72 | |
| Datalogiq EV | |
| 115 | | |
| 122 | | |
| 144.0 | |
Based on Abri’s
analysis of the respective business models, and discussions with DLQ, Abri determined that the closest comparable publicly listed companies
are Magnite Inc., System 1 Inc., and Zeta Global Holdings Corp. The mean enterprise value/2023 revenue multiple at which these close comps
are valued at is 2.2 times. Thus, the 1.7 – 2.0 times multiple range that Abri applied to its valuation of DLQ is at a
discount to the closest publicly listed comparable companies.
| 3 closest comps | |
Enterprise Value/2023 Revenue | |
| Magnite Inc. | |
| 2.8 | |
| System 1 | |
| 1.7 | |
| Zeta Global Holdings Corp | |
| 2.1 | |
| Mean | |
| 2.2 | |
Abri reiterates that this valuation assumes
that there are no further acquisitions during the 2023 projection horizon, even though 3 targets have been identified. Abri believes that
DLQ has a proven track record of making acquisitions and integrating them with the existing businesses.
The Abri board
considered this analysis and the consideration to be paid in connection with the business combination with DLQ and determined that they
were reasonable and fair (the Mentor Group fairness opinion was not available until after the board voted).
The Abri board
of directors and management team decided after the Merger Agreement was signed that it would be in the best interests of Abri and its
stockholders to obtain an independent valuation of DLQ by a professional valuation firm not otherwise involved in the Merger and on a
fixed fee basis not tied to the consummation of the Merger or contingent upon reaching any particular result, in order to assist it in
the determination of whether or not to proceed with the Merger at a stated value of $114,000,000.
The Abri board
considered several valuation firms and selected The Mentor Group, Inc. (“Mentor Group”) based on its long experience
and national reputation for valuing business enterprises on a going concern basis, its independence, and its willingness to work on a
fixed fee basis, and its compensation not tied to the consummation of the Merger or contingent upon the reaching of any particular result.
In addition, there was no material relationship between Mentor and Abri or its affiliates that existed during the past two years,
or otherwise mutually understood to be contemplated. Abri engaged The Mentor Group based on The Mentor Group’s experience and reputation.
On October 11, 2022,
Abri engaged The Mentor Group to evaluate the transaction.
On December 4,
2022, after reviewing the Mentor Group’s fairness opinion, the Abri board determined that the fairness opinion validated Abri’s
final decision.
Therefore, the Abri board
continues to recommend the business combination with DLQ.
Certain DLQ Projected Financial Information
The following
is a summary of the financial information and projections provided by DLQ to Abri as well as a summary of Abri’s management’s
analysis and evaluation of the information and projections. The summary set forth below does not purport to be a complete description
of the financial analysis performed or factors considered by us. Except as otherwise noted, market data used in our analysis is based
on market data as of January 31, 2022, and is not necessarily indicative of current market conditions.
DLQ does not
as a matter of course make public long-term forecasts or internal projections as to future performance, revenues, earnings or other
results due to, among other reasons, the inherent unpredictability and uncertainty of the underlying assumptions, estimates and projections.
As a result, DLQ does not endorse the projected financial information as a reliable indication of future results. Moreover, DLQ’s
internally prepared unaudited projected financial information presented below was based on estimates, assumptions and judgments made by
DLQ management at the respective time of its preparation and speak only as of such time. Except as required by law, DLQ has no obligation
to update the unaudited projected financial information included in this section and does not intend to do so. The unaudited prospective
financial information is not being included in this proxy statement in order to influence any Abri stockholder or DLQ stockholder to make
a decision with respect to the merger or to influence any DLQ stockholder or Abri stockholder as to whether or how such stockholder should
vote with respect to the Proposals contained herein, or any other matter.
Because the unaudited
projected financial information covers multiple years, such information by its nature becomes less predictive with each successive
year. Furthermore, the unaudited projected financial information does not necessarily reflect DLQ’s current estimates and does not
take into account any circumstances or events occurring after the date it was prepared, and some or all of the assumptions that have been
made regarding, among other things, the timing of certain occurrences or impacts, may have changed since such date. In particular, the
unaudited projected financial information set forth below does not give effect to the merger, nor does it take into account the effect
of any failure of the merger to occur, and should not be viewed as accurate in those contexts.
The unaudited
projected financial information should be evaluated in conjunction with the historical financial statements and other information regarding
DLQ contained in this proxy statement and Abri’s public filings with the SEC. DLQ stockholders and Abri stockholders are urged
to review the consolidated financial statements of DLQ and its subsidiary as of subsidiary as of June 30, 2023 and December 31, 2022,
and the risk factors included in this proxy statement. See “Risk Factors”, “Cautionary Statement Regarding
Forward-Looking Statements” and “Where You Can Find More Information”.
The unaudited
projected financial information constitutes forward-looking statements and no assurances can be given that the assumptions made in
preparing the unaudited prospective financial information will accurately reflect future conditions. The estimates and assumptions underlying
the unaudited prospective financial information involve judgments which may not be realized and that are inherently subject to significant
business, economic, competitive and regulatory uncertainties and contingencies, including, among others, risks and uncertainties described
under “Risk Factors” and “Cautionary Statement Regarding Forward-Looking Statements,” all of
which are difficult to predict and many of which are beyond the control of DLQ and/or Abri and will be beyond the control of the Combined
Company. In addition, the unaudited projected financial information will be affected by DLQ’s or the Combined Company’s, as
applicable, ability to achieve strategic goals, objectives and targets over the applicable periods. As a result, there can be no assurance
that the underlying assumptions will prove to be accurate or that the projected results will be realized, and actual results likely will
differ, and may differ materially, from those reflected in the unaudited prospective financial information, whether or not the mergers
are completed.
None of DLQ or
Abri’s management, board of directors, affiliates, advisors or other representatives assumes responsibility to update the below
information and future results may be materially different from those discussed. Any projections set forth below are not necessarily indicative
or predictive of future results or values, which may be significantly more or less favorable. Accordingly, the assumptions and estimates
used in, and the results derived from, the financial analyses are inherently subject to substantial uncertainty. Neither Abri’s
or DLQ’s independent auditors, nor any other independent accountants, have compiled, examined or performed any procedures with respect
to the projected financial information contained herein, nor have they expressed any opinion or any other form of assurance on such information
or its achievability, and assume no responsibility for, and disclaim any association with, the prospective financial information. The
audit reports included in this proxy statement relate to historical financial information. They do not extend to the prospective financial
information and should not be read to do so.
Certain of the
measures included in the projections are non-GAAP financial measures, including Adjusted EBITDA. Non-GAAP financial measures
should not be considered in isolation from, or as a substitute for, financial information presented in compliance with GAAP, and non-GAAP financial
measures as used by DLQ are not reported by all of its competitors and may not be comparable to similarly titled amounts used by other
companies.
In light of the foregoing factors and
the uncertainties inherent in these projections, stockholders are cautioned not to place undue reliance on these projections.
| Summary Financial Projection | |
Year Ended
December 31,
2022 | | |
Year Ended
December 31,
2023 | | |
Year Ended
December 31,
2024 | |
| Total Revenue | |
$ | 22,342,628 | | |
$ | 71,900,000 | | |
$ | 72,350,000 | |
| | |
| | | |
| | | |
| | |
| Cost and Operating Expenses | |
| | | |
| | | |
| | |
| Transaction Fees | |
$ | 750,000 | | |
$ | — | | |
$ | — | |
| Operating Expenses | |
$ | (22,502,178 | ) | |
$ | (73,109,000 | ) | |
$ | (65,936,000 | ) |
| Total cost and operating expenses | |
$ | (23,252,178 | ) | |
$ | (73,109,000 | ) | |
$ | (65,936,000 | ) |
| | |
| | | |
| | | |
| | |
| Other Income (Expense) | |
$ | — | | |
$ | — | | |
$ | — | |
| | |
| | | |
| | | |
| | |
| Net Income (Loss) before income taxes | |
$ | (909,550 | ) | |
$ | (1,209,000 | ) | |
$ | 6,414,000 | |
| Income tax provision | |
$ | — | | |
$ | — | | |
$ | — | |
| Net Income (Loss) | |
$ | (909,550 | ) | |
$ | (1,209,000 | ) | |
$ | 6,414,000 | |
| Net Income (Loss) per share – Basic and Diluted(1) | |
$ | (605 | ) | |
$ | (455 | ) | |
$ | 3,207 | |
| (1) | NOTE: The net (loss) income per share is adjusted to represent [2,000] shares outstanding. |
Additional Information
The inclusion
of the updated 2024 financial projections in this proxy statement should not be regarded as an indication that DLQ, Abri, their respective
directors, officers, advisors or other representatives considered, or now considers, such financial projections necessarily to be predictive
of actual future results or to support or fail to support your decision whether to vote for or against the Business Combination Proposal.
No person has made or makes any representation or warranty to any Abri or DLQ stockholder regarding the information included in these
financial projections. Management of the Combined Company will not refer back to the financial projections in its future periodic reports
filed under the Exchange Act.
The financial
projections were developed in good faith by DLQ’s management team based on their reasonable best estimates and taking into account
the following material estimates and hypothetical assumptions, which assumptions relative to industry averages were developed based on
DLQ management’s experience:
| · | brand awareness and acceptance of DLQ’s services
and offerings within the geographic markets in which it operates and expects to further grow operations by expanding in these regional
US markets in which it currently operates; |
| · | growth of DLQ’s current businesses and successful
adoption and revenue generation from its services and platforms including its agency business with the recent acquisition of BattleBridge
and its recently disclosed Managed Services Agreement between BattleBridge and a significant new client; |
| · | effects of the ongoing COVID-19 global health pandemic
do not have materially different or greater impact on DLQ’s business than currently; |
| · | sales and marketing efforts result in increases in sales
and revenues during the projected period; |
| · | closing the Business Combination, a full year of activity
from its affiliate management operations, including those related to the acquisition in the fourth quarter of 2022, and having sufficient
working capital to allow DLQ’s core lead generation business to return to 2021 levels. |
DLQ Valuation
In
order to establish a valuation range for DLQ, we compared certain financial information of DLQ to corresponding data and ratios from publicly
traded comparable companies that were deemed relevant to its analysis, including Magnite, Inc., System 1, Inc., and Zeta Global Holdings
Corp. as having relatively similar business models. The key criterion for selecting the publicly traded comparable companies was being
in a similar business as DLQ. In the selection of publicly traded comparable companies, we also ensured that the selected companies as
a group covered the various key business segments and business verticals in which DLQ operates.
Below
we highlight relevant aspects of the business descriptions of the publicly traded comparable companies.
At an implied enterprise value/revenue
(“EV/Revenue”) multiple of 2.9 x 2023 expected revenues, the implied enterprise valuation would be approximately
$209 million. In light of DLQ’s lower revenue and higher growth rate versus the 16 comparable companies, we believe that DLQ
should be valued at a 2023 EV/Revenue multiple in the 1.7 to 2.0 range, resulting in an enterprise valuation in the $122 to $144 million
range, putting DLQ at a reasonable discount to the comparable universe and the company`s closest comparable companies. This valuation
assumes there are no further acquisitions during the 2023 projection horizon. DLQ has demonstrated a recent track record of integrating
three acquisitions into its existing businesses. Should DLQ continue with more acquisitions in the near future, the valuation could be
viewed as being at a substantial discount to the comparable companies. Therefore, we believe that a pro forma equity valuation of DLQ
in the $122 - $144 million range is defensible, which we use to transact at a $114 million pre-money equity value.
| Comparable Public Companies |
|
Segment |
|
Ticker |
|
Business Description |
| AdTheorent Holdings Company, Inc |
|
LDM |
|
ADTH |
|
Digital media platform for advertisers which enables programmatic advertising campaigns. |
| Cardlytics, Inc |
|
LDM |
|
CDLX |
|
An advertising platform in bank’s digital channels, using purchase data to target people with ads. |
| Channel Advisor Corp |
|
LDM |
|
ECOM |
|
Saas platform that allows brands and retailers to improve their e-commerce operations, expand to new channels |
| Criteo SA |
|
LDM |
|
CRTO |
|
Allows commerce companies to achieve various marketing goals by engaging their consumers with personalized ads across the web and mobile. |
| Digital Media Solution |
|
LCM |
|
DMS |
|
A leading provider of technology enabled digital performance advertising solutions connecting consumers and advertisers within auto, home, health and life insurance and multiple top consumer verticals. |
| Hubspot, Inc |
|
LCM |
|
HUBS |
|
Provides a cloud-based marketing, sales and customer service platform. Applications include lead generation. |
| Comparable Public Companies |
|
Segment |
|
Ticker |
|
Business Description |
| LiveRamp Holdings, Inc |
|
LCM |
|
RAMP |
|
A customer data platform that gathers and unifies different types of customer data to understand your customer’s behaviour and their specific needs. |
| Magnite, Inc |
|
LDM |
|
MGNI |
|
Magnite Inc. provides technology solutions to automate the purchase and sale of digital advertising inventory. |
| MediaAlpha |
|
LCM |
|
MAX |
|
Insurance customer acquisition platform |
| Porch Group |
|
LDM/LCM |
|
PRCH |
|
Vertical software platform for the home |
| PubMatic, Inc Class A |
|
LDM |
|
PUBM |
|
Provides a cloud infrastructure platform that enables real-time programmatic advertising transactions. |
| System1, Inc |
|
LCM |
|
SST |
|
Operates a customer acquisition platform. |
| The Trade Desk, Inc |
|
LDM |
|
TTD |
|
Advertising technology company offering an online advertising platform that manages display, social mobile, and video advertising campaigns. |
| Tremo International Ltd |
|
LDM |
|
TRMR |
|
Provides end-to-end technology advertising platform operating across three core capabilities Video, Data, and CTV. |
| Viant technology, Inc |
|
LDM |
|
DSP |
|
Software platform that enables marketers and their advertising agencies to plan, buy and measure advertising across channels. |
| Zeta Global Holdings Corp |
|
LCM |
|
ZETA |
|
Operates an omnichannel data-driven cloud platform that provides enterprises with consumer intelligence and marketing automation software. |
For purposes of this analysis, we used
certain publicly available historical financial data for 16 selected publicly traded companies. The 16 companies included in the selected
public company analysis are reflected in the chart below.
| Company |
|
Ticker |
|
Market Cap
(2023) |
|
Revenue (2023) |
|
Gross Margin (2023) |
|
EV/Rev ‘23 |
| AdTheorent Holding Company, Inc. |
|
ADTH |
|
$ |
264 |
|
$ |
202 |
|
62 |
% |
|
1.1x |
| Cardlytics, Inc. |
|
CDLX |
|
$ |
461 |
|
$ |
369 |
|
40 |
% |
|
1.6x |
| Channeladvisor Corporation |
|
ECOM |
|
$ |
440 |
|
$ |
196 |
|
77 |
% |
|
2.0x |
| Criteo SA Sponsored ADR |
|
CRTO |
|
$ |
1,658 |
|
$ |
1,104 |
|
85 |
% |
|
1.0x |
| Digital Media Solutions, Inc. Class A |
|
DMS |
|
$ |
110 |
|
$ |
425 |
|
30 |
% |
|
0.7x |
| HubSpot, Inc. |
|
HUBS |
|
$ |
16,102 |
|
$ |
2,097 |
|
83 |
% |
|
7.8x |
| LiveRamp Holdings, Inc. |
|
RAMP |
|
$ |
1,388 |
|
$ |
679 |
|
76 |
% |
|
1.5x |
| Magnite, Inc. |
|
MGNI |
|
$ |
1,058 |
|
$ |
583 |
|
65 |
% |
|
2.8x |
| MediaAlpha, Inc. Class A |
|
MAX |
|
$ |
528 |
|
$ |
556 |
|
15 |
% |
|
1.2x |
| Porch Group, Inc. |
|
PRCH |
|
$ |
234 |
|
$ |
365 |
|
67 |
% |
|
1.0x |
| PubMatic, Inc. Class A |
|
PUBM |
|
$ |
1,056 |
|
$ |
332 |
|
71 |
% |
|
3.0x |
| System1, Inc. Class A |
|
SST |
|
$ |
1,221 |
|
$ |
1,031 |
|
31 |
% |
|
1.7x |
| Trade Desk, Inc. Class A |
|
TTD |
|
$ |
30,960 |
|
$ |
1,989 |
|
79 |
% |
|
16.0x |
| Tremor International Ltd. Sponsored ADR |
|
TRMR |
|
$ |
543 |
|
$ |
390 |
|
90 |
% |
|
0.7x |
| Viant Technology, Inc. Class A |
|
DSP |
|
$ |
287 |
|
$ |
174 |
|
85 |
% |
|
1.8x |
| Zeta Global Holdings Corp. Class A |
|
ZETA |
|
$ |
1,335 |
|
$ |
667 |
|
65 |
% |
|
2.1x |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Mean |
|
|
|
$ |
3,603 |
|
$ |
697 |
|
64 |
% |
|
2.9x |
| Median |
|
|
|
$ |
800 |
|
$ |
490 |
|
69 |
% |
|
1.6x |
On August 30,
2022, DLQ, Inc. and Benchmark Company, LLC entered into an agreement where Benchmark agreed to act as the exclusive financial advisor
relating to a merger or acquisition with a publicly traded company. Benchmark acted merely as a high level advisor, and provided the company
with publicly available information from Factset related other SPAC deals. The companies were selected based on similar business segments
and business verticals to those in which DLQ operates and how recent those transactions occurred. No specific factor was more important
than the other.
At an implied
enterprise value/revenue (“EV/Revenue”) multiple of 2.9 x 2023 expected revenues, the implied enterprise valuation
would be approximately $209 million. In light of DLQ’s lower revenue and higher growth rate versus the 16 comparable companies,
we believe that DLQ should be valued at a 2023 EV/Revenue multiple in the 1.7 to 2.0 range, resulting in an enterprise valuation in the
$122 to $144 million range, putting DLQ at a reasonable discount to the comparable universe and the company`s closest comparable
companies. This valuation assumes there are no further acquisitions during the 2023 projection horizon. DLQ has demonstrated a recent
track record of integrating three acquisitions into its existing businesses. Should DLQ continue with more acquisitions in the near future,
the valuation could be viewed as being at a substantial discount to the comparable companies. Therefore, we believe that a pro forma equity
valuation of DLQ in the $122 – $144 million range is defensible, which we believed should be discounted to a $114 million
pre-money equity value, based on market conditions at that time.
Opinion of Abri’s Financial
Advisor
Abri’s
board of directors retained The Mentor Group Inc. (“Mentor Group” or “TMG”) to act
as a financial advisor to the board in connection with the Business Combination to render to the board an opinion as to the fairness to
Abri’s stockholders, from a financial point of view, of the consideration to be paid by in the Business Combination. On December 4,
2022, Mentor delivered a written opinion and final supporting analysis presentation to the effect that as of August 29, 2022 and
based upon and subject to the factors and assumptions set forth therein, the consideration to be paid in the Business Combination pursuant
to the Merger Agreement is fair to Abri’s stockholders from a financial point of view.
The full text
of the written opinion of TMG dated December 4, 2022, which sets forth assumptions made, procedures followed, matters considered
and limitations on the review undertaken in connection with the opinion, is attached as Annex D to this proxy statement. The
following summary of TMG’s opinion in this proxy statement is qualified in its entirety by reference to the full text of the opinion.
TMG provided its opinion for the information and assistance of Abri’s board of directors in connection with its consideration of
the Business Combination. TMG’s opinion was not intended to and does not constitute a recommendation as to how any of Logiq’s
stockholders should vote or take any action with respect to the Business Combination or any other matter.
TMG understands
that Abri SPAC I, Inc. (“Abri”, the “Parent”) entered into a merger agreement
(the “Merger Agreement”) on September 9, 2022 by and among Logiq, Inc., a Delaware corporation (the “DLQ
Parent”), DLQ, Inc., a Nevada corporation ( “DLQ”), Abri SPAC I, Inc., and Abri Merger Sub,
Inc., a Delaware corporation and wholly owned subsidiary of Parent (“Merger Sub”). As currently contemplated
by the Merger Agreement, at the Effective Time: (i) Merger Sub shall be merged with and into DLQ; (ii) the separate corporate
existence of Merger Sub shall thereupon cease, and DLQ shall be the Surviving Corporation, which shall be named “Collective Audience,
Inc.”; (iii) the Surviving Corporation shall become a wholly-owned Subsidiary of Parent, which shall change its name to
“Collective Audience, Inc.”; (iv) each share of DLQ Common Stock, if any, that is owned by Parent or Merger Sub (or any
other Affiliate of Parent) or DLQ (or any of its Subsidiaries, as treasury stock or otherwise), will automatically be cancelled and retired
without any conversion thereof and will cease to exist, and no consideration will be delivered in exchange therefor; (v) each share
of DLQ Common Stock, if any, held immediately prior to the Effective Time by DLQ as treasury stock shall be automatically cancelled and
extinguished, and no consideration shall be paid with respect thereto; (vi) each share of DLQ Common Stock issued and outstanding
immediately prior to the Effective Time shall, in accordance with DLQ Certificate of Incorporation and subject to this Merger Agreement,
be converted into the right to receive a number of shares of Parent Common Stock equal to the Conversion Ratio; (vii) the Conversion
Ratio is an amount equal to the Per Share Merger Consideration Amount of $114,000,000 divided by the number of Fully Diluted DLQ Shares;
(viii) Fully Diluted DLQ shares are all shares of DLQ Common Stock that are issued and outstanding immediately prior to the Effective
Time, plus all shares of DLQ Common Stock issuable upon conversion, exercise or exchange of any other in-the-money securities of
DLQ convertible into or exchangeable or exercisable for shares of DLQ Common Stock.
In connection
with rendering its opinion, TMG made such reviews, analyses and inquiries as deemed necessary and appropriate under the circumstances,
including, among other things:
| · | Reviewed a final draft of the Merger Agreement by and
among Logiq, Inc., DLQ, Inc., Abri SPAC I Inc., and Abri Merger Sub, Inc. dated September 9, 2022; |
| · | reviewed the Form S-4 Registration Statement filed
with the SEC on November 3, 2022 regarding the Merger |
| · | reviewed the Letter of Intent dated July 31, 2022
regarding the Merger including Exhibit A, Summary of Terms; |
| · | reviewed certain information relating to the historical,
current and future operations, financial condition and prospects of DLQ made available to us by Abri, including financial projections
(and adjustments thereto) prepared by the management of DLQ relating to DLQ for the fiscal years ending 2022 through 2023, (the “DLQ
Forecasts”), which forecasts appear in “Certain DLQ Projected Financial Information” above; |
| · | reviewed the 10-Ks and 10-Qs of Logiq, Inc. for the
fiscal years 2020 – 2021 and fiscal quarters of 2022 through September 30, 2022; |
| · | reviewed data compiled from Factset as of August 29,
2022; |
| · | spoke with certain members of the management of Abri
regarding the business, operations, financial condition and prospects of DLQ, the Merger and related matters; |
| · | compared the financial and operating performance of
DLQ with that of other public companies that we deemed to be relevant; |
| · | considered publicly available financial terms of certain
transactions that we deemed to be relevant; and, |
| · | conducted such other financial studies, analyses and
inquiries and considered such other information and factors as we deemed appropriate. |
In addition,
TMG relied upon and assumed, without independent verification, the accuracy and completeness of all data, material other information furnished,
or otherwise made available to TMG, discussed with or reviewed by TMG, or publicly available, and do not assume any responsibility with
respect to such data, material, and other information. In addition, Abri management has advised TMG, and TMG assumed that DLQ forecasts
reviewed by TMG have been reasonably prepared in good faith on bases reflecting the best currently available estimates and judgments of
DLQ management as to the future financial results and condition of DLQ and the other matters covered thereby, and TMG expresses no opinion
with respect to such projections or the assumptions on which they are based. TMG relied upon and assumed, without independent verification,
that there has been no change in the business, assets, liabilities, financial condition, results of operations, cash flows or prospects
of DLQ since the respective dates of the most recent financial statements and other information, financial or otherwise, provided to TMG
that would be material to TMG’s analyses or its opinion, and that there is no information or any facts that would make any of the
information reviewed by us incomplete or misleading.
TMG relied upon
and assumed, without independent verification, that (i) the representations and warranties of all parties to the Merger Agreement
identified above and all other related documents and instruments that are referred to therein are true and correct, (ii) each party
to the Letter of Intent (“LOI”) and other related documents and instruments will fully and timely perform all
of the covenants and agreements required to be performed by such party, (iii) all conditions to the consummation of the Merger will
be satisfied without waiver thereof, and (iv) the Merger will be consummated in a timely manner in accordance with the terms described
in the LOI, the Merger Agreement, and other related documents and instruments. TMG relied upon and assumed, without independent verification,
that (i) the Merger will be consummated in a manner that complies in all respects with all applicable federal and state statutes,
rules and regulations, and (ii) all governmental, regulatory, and other consents and approvals necessary for the consummation of
the Business Combination will be obtained and that no delay, limitations, restrictions or conditions will be imposed or amendments, modifications
or waivers made that would have an effect on the Business Combination or DLQ that would be material to our analyses or TMG’s opinion.
Furthermore,
in connection with this opinion, TMG was not requested to make, and has not made, any physical inspection or independent appraisal or
evaluation of any of the assets, properties, or liabilities (fixed, contingent, derivative, off-balance-sheet or otherwise) of DLQ
or any other party, nor were we provided with any such appraisal or evaluation. TMG has not undertaken an independent analysis of any
potential or actual litigation, regulatory action, possible unasserted claims or other contingent liabilities, to which DLQ is or may
be a party or is or may be subject, or of any governmental investigation of any possible unasserted claims or other contingent liabilities
to which DLQ is or may be a party or is or may be subject.
The following
is a summary of the material financial analyses performed by TMG in connection with the preparation of its fairness opinion. The preparation
of analyses and a fairness opinion is a complex analytic process involving various determinations as to the most appropriate and relevant
methods of financial analysis and the application of those methods to the particular circumstances. Therefore, this summary does not purport
to be a complete description of the analyses performed by TMG.
The financial
analyses are summarized below and presented in tabular format in TMG’s attached opinion. The order in which these analyses are presented
below, and the results of those analyses, should not be taken as an indication of the relative importance or weight given to these analyses
by TMG or Abri’s board of directors. Except as otherwise noted, the following quantitative information, to the extent it is based
on market data, is based on market data as it existed on or before August 29, 2022 and is not necessarily indicative of current market
conditions. Financial information of DLQ is valued as of September 30, 2022, as provided by DLQ management, which includes the changes
in the revenue (and as a result EBITDA) expected from clients of the rapidly expanding business. All analyses conducted by TMG were going-concern analyses
and TMG expressed no opinion regarding the liquidation value of any entity.
TMG completed
a series of financial analyses to derive a range of potential equity values for DLQ and calculated the value of the implied post-merger value
of DLQ’s Common Shares. TMG’s financial analysis employed three methodologies, with particular weight given to each:
| · | selected public company analysis using a weighted average; |
| · | selected guideline public company analysis using regression
analysis; and, |
| · | guideline merged and acquired company analysis. |
Valuation Summary
Based on its
analysis of the Business Combination and the equity value of DLQ, the Enterprise Value (“EV”) of DLQ following
the Business Combination was estimated to be between approximately $116,601,200 and $452,457,000. This range is based on the following,
among other factors:
| · | the comparative values of public companies providing
digital marketing services to their customers, including lead generation, digital advertising, customer data platforms, predictive targeting,
and other software marketing services, |
| · | the comparative values of recent M&A transactions
involving similar companies, |
| · | DLQ’s financial forecast for 2022-2023, and, |
| · | the results of the Guideline Public Company Analysis,
and Guideline Merged and Acquired Company Analysis. |
Guideline Public Company
Analysis
TMG selected
thirteen Guideline Public Companies based on a review of public companies providing digital marketing services to their customers, including
lead generation, digital advertising, customer data platforms, predictive targeting, and other software marketing services. TMG reviewed
market valuations and implied trading statistics for the thirteen selected companies. DLQ forecasted negative margins (EBITDA and EBIT)
for the two years (2022 and 2023) for which DLQ had a forecast. Six of the Guideline Public Companies were EBITDA negative and seven
EBIT negative as of the Valuation Date. TMG therefore relied upon revenue multiples to determine the value of DLQ.
In selecting
the range of multiples to apply to DLQ in future periods, TMG considered the forecast growth of DLQ with respect to the forecast growth
of the guideline public companies. For the guideline public companies, the EV/2022 Revenue multiples ranged from 0.40 to 3.20, with median
1.25 and mean 1.59; the EV/2023 Revenue multiples ranged from 0.34 to 2.78 with median 1.00 and mean 1.37. TMG selected the first and
third quartile multiples to apply to the 2022 and 2023 forecast revenue of DLQ. Based on the application of the guideline public
company revenue multiples to the 2022 and 2023 forecast revenue, TMG determined an implied enterprise value range of from $20,029,200
(rounded) to $132,296,000 (rounded).
| |
|
Valuation Multiples |
|
Valuation Summary |
| |
|
Public
Company
Range |
|
Public
Company
Median |
|
Public
Company
Mean |
|
Selected
Range |
|
Revenue
Forecast
($000) |
|
Enterprise
Value Range
($000) |
| EV/2022 Revenue |
|
0.40x – 3.20x |
|
1.25x |
|
1.59x |
|
0.99x – 2.01x |
|
$ |
20,231.6 |
|
$20,029.2 – $40,665.4 |
| EV/2023 Revenue |
|
0.34x – 2.78x |
|
1.00x |
|
1.37x |
|
0.90x – 1.84x |
|
|
71,900.0 |
|
64,710.0 – 132,296.0 |
No company used
in this analysis is identical or directly comparable to DLQ. Accordingly, an evaluation of the results of this analysis is not entirely
mathematical. Rather, this analysis involves considerations and judgements concerning differences in financial and operating characteristics
and other factors that could affect the public trading or other values of the companies to which DLQ is compared.
For the regression
analysis, TMG narrowed the number of guideline public companies to nine by eliminating companies with EV over $600 million, as including
these four companies did not provide meaningful results in the analyses. The R² measure resulting from the regression analyses indicated
that there was a positive relationship between guideline public company EV and forecast 2022 and 2023 revenue. Based upon the application
of the resulting regression equation (EV = m * forecast revenue + b) that was derived for each of the two forecast years, TMG calculated
the implied EV for DLQ, from which was calculated the implied revenue multiple for each of the two forecast years 2022 and 2023.
Application of the revenue multiples implied by the regression analyses to the 2022 and 2023 forecast revenue resulted in an implied EV
range of from $107,203,300 (rounded) to $121,143,900 (rounded).
| |
|
Valuation Multiples |
|
Valuation Summary |
| |
|
Regression Analysis 2022 Multiple |
|
Regression Analysis 2023 Multiple |
|
Selected
Range |
|
Revenue
Forecast
($000) |
|
Enterprise
Value Range
($000) |
| EV/2022 Revenue |
|
5.30x |
|
|
|
5.30x – 5.30x |
|
$ |
20,231.6 |
|
$107,203.3 – $107,203.3 |
| EV/2023 Revenue |
|
|
|
1.68x |
|
1.68x – 1.68x |
|
|
71,900.0 |
|
121,143.9 – 121,143.9 |
Guideline Merged and
Acquired Company Analysis
TMG selected
seven transactions of companies in the same industry as and similar to DLQ including:
| · | TV Squared Limited (acquired by Innovid Corp.) |
| · | Even Financial Inc. (acquired by MoneyLion, Inc.) |
| · | Scryer, Inc. (acquired by Altus Group Limited) |
| · | PandoLogic Ltd. (acquired by Veritone, Inc.) |
| · | Sharpspring, Inc. (acquired by Constant Contact, Inc.) |
| · | Synacor, Inc. (acquired by Centre Lange Partners, LLC) |
| · | Telaria, Inc. (acquired by The Rubicon Project, Inc.) |
None of the acquired
companies was EBITDA positive at the date of acquisition. TMG determined multiples of EV to revenue based on the transaction consideration.
The EV Revenue multiples ranged from 1.09 to 8.42, with median 3.71 and mean 4.59. As in the case of the guideline public companies, TMG
selected the first and third quartile multiples to apply to the 2022 and 2023 forecast revenue of Logiq, Inc. Based on the application
of the revenue multiples to the 2022 and 2023 forecast revenue, TMG determined an implied enterprise value range from $48,353,400 (rounded)
to $1,212,510,100 (rounded).
| |
|
Valuation Multiples |
|
Valuation Summary |
| |
|
Target
Company
Range |
|
Target
Company
Median |
|
Target
Company
Mean |
|
Selected
Range |
|
Revenue
Forecast
($000) |
|
Enterprise
Value Range
($000) |
| EV/TTM Revenue |
|
1.09x – 8.42x |
|
3.71x |
|
4.59x |
|
2.39x – 7.06x |
|
$ |
20,231.6 |
|
$48,353.4 – $142,753.8 |
| |
|
|
|
|
|
|
|
|
|
|
71,900.0 |
|
171,841.0 – 1,212,510.1 |
No company used
in this analysis is identical or directly comparable to DLQ. Accordingly, an evaluation of the results of this analysis is not entirely
mathematical. Rather, this analysis involves considerations and judgements concerning differences in financial and operating characteristics
and other factors that could affect the public trading or other values of the companies to which DLQ is compared.
Miscellaneous
The preparation
of a financial opinion is a complex analytical process involving various determinations as to the most appropriate and relevant methods
of financial analysis and the application of those methods to the particular circumstances and, therefore, a financial opinion is not
readily susceptible to partial analysis or summary description.
In performing
its analyses, TMG considered industry performance, general business and economic conditions and other matters, many of which are beyond
the control of TMG and DLQ. The estimates of the future performance of DLQ in or underlying TMG’s analyses are not necessarily
indicative of actual values or actual future results, which may be significantly more or less favorable than those estimates or those
suggested by TMG’s analyses. These analyses were prepared solely as part of TMG’s analysis of the fairness, from a financial
point of view, of the merger consideration and were provided to Abri’s board of directors in connection with the delivery of TMG’s
opinion. The analyses do not purport to be appraisals or to reflect the prices at which a company might actually be sold or the prices
at which any securities have traded or may trade at any time in the future. Accordingly, the estimates used in, and the ranges of valuations
resulting from any particular analysis described above are inherently subject to substantial uncertainty and should not be taken to be
TMG’s view of the actual value of DLQ.
Abri provided
for a fixed fee of not to exceed $55,000, subject to adjustment due to discovery of unknown conditions or other scope changes, plus reimbursement
of fees associated with the review of disclosure related to TMG’s engagement and opinion, and reimbursement of certain costs and
expenses. Fees billed by The Mentor Group to date have totaled $35,000, which have been paid in full. The engagement agreement includes
various representations, warranties and indemnities on the part of Abri SPAC I, Inc. and also provided that The Mentor Group could
rely on projections and financial statements provided by the Board, Abri SPAC I, Inc. and/or Logiq, Inc., without independent verification.
Abri has also
agreed to indemnify TMG and its affiliates, and the respective controlling persons, directors, officers, partners and employees of each
of the foregoing against any actions taken or omitted to be taken in connection with Abri’s engagement of TMG or otherwise relate
to or arise out of TMG’s activities on Abri’s behalf under the TMG engagement.
There was no
material relationship between TMG and Abri or its affiliates that existed during the past two years, or otherwise mutually understood
to be contemplated. Abri engaged TMG based on TMG’s experience and reputation. TMG is regularly engaged to render financial opinions
in connection with mergers, acquisitions, divestitures and for other purposes. TMG may in the future provide financial advisory or investment
banking services to Abri, DLQ or its affiliates and may receive compensation for the rendering of these services.
Interests of Certain Persons in the Business Combination
When you consider
the recommendation of the Board in favor of adoption of the Business Combination Proposal and other Proposals, you should keep in mind
that Abri’s directors and officers have interests in the Business Combination that are different from, or in addition to, your interests
as a stockholder, including:
| · | At an Extension Meeting of Abri’s stockholders
held on December 9, 2022, Abri’s stockholders approved (i) a proposal to amend Abri’s amended and restated certificate
of incorporation, and (ii) a proposal to amend the Management Trust Agreement with the Transfer Agent, to extend the date by which
Abri has to consummate a business combination from February 12, 2023 until August 12, 2023, on an as needed, month-to-month basis
(each an “Extension”), by depositing an additional $87,500 (a “Contribution”) into
the Trust Account for each such one-month Extension (referred to as the “December 9 Amendments”).
The Sponsor made aggregate Contributions in the amount of $525,000 to extend the time to complete a business combination to August 12,
2023. |
| · | If an initial business combination, such as the Business
Combination, is not completed by February 12, 2023, Abri will be required to dissolve and liquidate. |
| |
· |
If the Business Combination is not approved, in accordance with our Charter, the 1,433,480 founder shares held by our Sponsor, our officers and directors, which were acquired prior to the IPO for an aggregate purchase price of $25,000, will be worthless (as the holders have waived liquidation rights with respect to such shares), as will the 294,598 shares of Common stock and 294,598 Private Warrants that were included in the Private Units acquired simultaneously with the IPO and in connection with the exercise of the overallotment option, for an aggregate purchase price of $2,945,980. Irrespective of existing lock-up agreements that impose restrictions on the transfer of the founder shares, the shares of Common Stock in the Private Units and Private Warrants, such founder shares together with the shares of Common Stock in the Private Units, and Private Warrants had an aggregate market value of approximately $3,249,416 based on the last sale price of $10.95 and $0.08, respectively, on Nasdaq on September 25, 2023 |
| · | The Sponsor may receive up to $13,188,016 (or 20%) of
the proceeds of the exercise of the Public Warrants, if the Public Warrants are exercised at $11.50 per share. The Public Warrants may
be redeemed for $0.01 per Public Warrant unless the holder thereof exercises such Public Warrant, so long as the price per share of the
Combined Company’s stock is above $16.50 for over any twenty (20) consecutive trading days. For more information, see
“Summary of the Proxy statement — Agreements to be Executed at Closing — Warrant Revenue Sharing
Side Letter”; |
| · | the fact that the Sponsor may receive up to 1,000,000
Earnout Shares if the Combined Company achieves certain milestones as follows: |
| · | 250,000 Sponsor Earnout Shares will be earned and released
upon satisfaction of the First Milestone Event (as defined in the Sponsor Earnout Agreement), which would have a value of $4,125,000 with
the stock price at $16.50; |
| · | 350,000 Sponsor Earnout Shares will be earned and released
upon satisfaction of the Second Milestone Event (as defined in the Sponsor Earnout Agreement), which, including the first tranche of 250,000
Earnout Shares, would have a total value of $13,800,000 with the stock price at $23.00; and |
| · | 400,000 Sponsor Earnout Shares will be earned and released
upon satisfaction of the Third Milestone Event (as defined in the Sponsor Earnout Agreement), which, including the first tranche of 250,000
Earnout Shares plus the second tranche of 350,000 Earnout Shares, would have a total value of $30,000,000 with the stock price at $30.00. |
| · | If the Business Combination is completed, assuming the
stock price of the Combined Company is $30.00 per share, and (i) the Public Warrants are exercised; (ii) the Private Warrants
are exercised on a cashless exercise basis; (iii) all Earnout Share Milestones are achieved; and (iv) the Sponsor and its affiliates
still hold 1,728,078 shares of Common stock (which includes 1,433,480 founder shares plus 294,598 shares included in the Private
Units), the Sponsor stands to gain up to $13,188,016 for the exercise of the Public Warrants; $2,678,164 in value for the 89,272 shares
with the cashless exercise of the Private Warrants; $30,000,000 in value of the Earnout Shares; and $51,842,340 in value of the 1,728,078 shares
held, for a total of $97,708,520. |
| · | On March 8, 2022, Abri issued a convertible promissory
note (the “First Working Capital Note”) to the Sponsor. Pursuant to the First Working Capital Note, the Sponsor
agreed to loan us an aggregate principal amount of $300,000. On April 4, 2022, Abri issued a second convertible promissory note for
an aggregate principal amount of $500,000 (the “Second Working Capital Note”) to the Sponsor. On August 26,
2022, Abri issued a third convertible promissory note for an aggregate principal amount of $300,000 (the “Third Working Capital
Note”) to the Sponsor. On November 22, 2022, Abri issued a fourth convertible promissory note for an aggregate principal
amount of $150,000 (the “Fourth Working Capital Note”) to the Sponsor. On January 17, 2023, Abri
issued a fifth convertible promissory note for an aggregate principal amount of $200,000 (the “Fifth Working Capital Note”)
to the Sponsor. On February 10, 2023, Abri issued a sixth convertible promissory note for an aggregate principal amount of $150,000
(the “Sixth Working Capital Note”) to the Sponsor and on July 31, 2023, the Company issued a seventh working
capital note in the amount of $11,250 (the “Seventh Working Capital Note”) to the Sponsor (the First Working
Capital Note through the Seventh Working Capital Notes are hereinafter referred to as the “Working Capital Notes”).
The Working Capital Notes were issued to fund working capital of Abri. The Working Capital Notes are non-interest bearing and all
outstanding amounts under the Working Capital Notes will be due on the date on which we consummate our initial business combination (the
“Maturity Date”). |
| · | On August 5, 2022, Abri deposited $573,392 into
the trust account of ABRI (the “Trust Account”), to extend the time to complete a Business Combination until
November 12, 2022. On November 1, 2022, Abri deposited $573,392 into the Trust Account for the second of two three-month extensions
to extend the time to complete a Business Combination until February 12, 2023. |
| · | On February 6, 2023, March 10, 2023, April 11,
2023, May 11, 2023, June 9, 2023 and July 10, 2023, Abri deposited $87,500 for each one-month extension (or $525,000 in
total) into the Trust Account to extend the time to complete a business combination to August 12, 2023. |
| · | On August 7, 2023, at the Second Extension Meeting,
the stockholders approved the proposal to amend the Company’s Charter: (a) giving the Company the right to extend the date by which
it has to complete a business combination to February 12, 2024 without making any further deposits into the Trust Account, and (b) to
change the Charter by removing the requirement to have net tangible assets of at least $5,000,001 upon consummation of a Business Combination.- |
| · | If we are unable to complete a business combination
and distribute the proceeds held in trust to our public stockholders, our Sponsor has agreed (subject to certain exceptions) that it will
be liable to ensure that the proceeds in the trust account are not reduced below $10.00 per share by the claims of target businesses or
claims of vendors or other entities that are owed money by us for services rendered or contracted for or products sold to us; |
| · | All rights specified in Abri’s Charter as amended
on December 9, 2022 and August 9, 2023 (to extend the time to complete a business combination to August 12, 2023), relating
to the right of officers and directors to be indemnified by Abri, and of Abri’s officers and directors to be exculpated from monetary
liability with respect to prior acts or omissions, will continue after a business combination. If the Business Combination is not approved
and Abri liquidates, Abri will not be able to perform its obligations to its officers and directors under those provisions. |
| · | The exercise of Abri’s directors’ and officers’
discretion in agreeing to changes or waivers in the terms of the transaction may result in a conflict of interest when determining whether
such changes or waivers are appropriate and in our stockholders’ best interest. |
| · | Our Sponsor, officers, directors, initial stockholders
or their affiliates, are entitled to 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 business combinations. However, if Abri fails to consummate
the Business Combination, they will not have any claim against the trust account for reimbursement. Accordingly, Abri will most likely
not be able to reimburse these expenses if the Business Combination is not completed, including any balances outstanding on any Working
Capital Notes, as described herein, issued to Abri by the Sponsor. As of June 30, 2023, $1,650,000 is outstanding from the Working Capital
Notes, $1,146,784 for two payments of $573,392 for the two, three-month extensions, plus five payments of $87,500 ($437,500) for a one
month extension, and there are no out-of-pocket expenses owed to Abri’s officers, directors or Sponsor. |
| · | If a business combination is not consummated, and there
are insufficient funds to repay the Working Capital Notes, the automatic extension payments of $1,146,784, the six one-month extension
payments of $87,500 for a total of $1,671,784 in extension payments through July 12, 2023, and any further Extension payments made,
all unpaid amounts would be forgiven. All or a portion of the amounts outstanding under the Working Capital Notes may be converted on
the Maturity Date into Units at a price of $10.00 per Unit at the option of the Sponsor. The Units would be identical to Abri’s
outstanding Private Units that were issued to the Sponsor in the Private Placement. The Working Capital Notes contain customary events
of default, including, among others, those relating to Abri’s failure to make a payment of principal when due and to perform any
other obligations that is not timely cured after written notice of such default from the Sponsor. |
| · | The Current Charter provides 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. Our officers and directors (other than our independent directors)
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. Although a member of the Sponsor knows Brent Suen for several years, there is no current or historical business relationship,
and the determination to move forward with DLQ as the target of the Business Combination was made solely on the merits of the transaction
and proposed to the board of Directors of Abri in the best interests of the stockholders. The Board did not obtain a fairness opinion
on which to base its assessment to sign the merger agreement. However, board of directors has obtained a fairness opinion from the Mentor
Group in connection with its determination to proceed with the Business Combination and for the recommendation of the Business Combination
to the stockholders. |
See “Proposal No.
1 — The Business Combination Proposal — Interests of Certain Persons in the Business Combination” for
additional information.
Appraisal Rights
There are no appraisal rights available
to our stockholders in connection with the Business Combination.
Total Shares of Common Stock Outstanding Upon Consummation
of the Business Combination
It is
anticipated that, upon consummation of the Business Combination, after giving effect to the Merger It is anticipated that, upon consummation
of the Business Combination, after giving effect to the Merger Consideration including the Earnout Consideration, as described herein,
the exercise of outstanding Public Warrants and Private Warrants, and assuming (i) no redemption of shares by the public stockholders
(ii) partial redemption of 626,186 shares by the public stockholders, and (iii) maximum redemption of shares by the public
stockholders, the existing public stockholders will own approximately 3/0%, 1.5% and 0%, respectively, of the issued Combined Company’s
shares of Common Stock, the Sponsor and its affiliates will own 7.6%, 7.7% and 7.8%, respectively of the issued Combined Company’s
shares of Common Stock, the Representative (as defined below) will own approximately 0.1%, 0.1% and 0.1%, respectively of the issued Combined
Company’s shares of Common Stock, and DLQ Parent will own approximately 26.4%, 26.8% and 27.2%, respectively, of the issued Combined
Company’s shares of Common Stock, DLQ Parent Stockholders will own approximately 16.4%, 16.7% and 17.0%, respectively, of the issued
Combined Company’s shares of Common Stock, DLQ Investors will own approximately 7.0%, 7.1% and 7.2%, respectively, of the issued
Combined Company’s shares of Common Stock and DLQ Management will own approximately 8.7%, 8.9% and 9.0%, respectively, of the issued
Combined Company’s shares of Common Stock. If the actual facts are different from these assumptions (which they are likely to be),
the percentage ownership retained by the Abri stockholders will be different. See “Unaudited Pro Forma Condensed Combined Financial
Information.”
The following
summarizes the pro forma ownership of Common Stock, including Common Stock underlying Units and shares of Common Stock, of Abri following
the Closing of the Business Combination under (i) a no redemption scenario, (ii) an interim redemption scenario assuming fifty percent
(50%) redemption, and (iii) a maximum redemption scenario, but does not take into account the issuance of any Management Earnout Shares,
or the Sponsor Earnout Shares:
| | |
No Additional
Redemption
Scenario(1) | | |
Interim Redemption
Scenario(2) | | |
Maximum Redemption
Scenario(3) | |
| Equity Capitalization Summary | |
# of Shares | | |
% | | |
# of Shares | | |
% | | |
# of Shares | | |
% | |
| DLQ Parent | |
| 6,038,000 | | |
| 43.6 | % | |
| 6,038,000 | | |
| 44.7 | % | |
| 6,038,000 | | |
| 45.9 | % |
| DLQ Parent Stockholders | |
| 3,762,000 | | |
| 27.2 | % | |
| 3,762,000 | | |
| 27.9 | % | |
| 3,762,000 | | |
| 28.6 | % |
| DLQ Investors | |
| 1,600,000 | | |
| 11.6 | % | |
| 1,600,000 | | |
| 11.9 | % | |
| 1,600,000 | | |
| 12.2 | % |
| Total DLQ Equity Holders | |
| 11,400,000 | | |
| 82.4 | % | |
| 11,400,000 | | |
| 84.4 | % | |
| 11,400,000 | | |
| 86.7 | % |
| Abri Initial Public Stockholders | |
| 682,148 | | |
| 4.9 | % | |
| 341,074 | | |
| 2.5 | % | |
| — | | |
| — | % |
| Abri Initial Stockholders | |
| 1,728,078 | | |
| 12.5 | % | |
| 1,728,078 | | |
| 12.8 | % | |
| 1,728,078 | | |
| 13.1 | % |
| Representative Shares | |
| 30,000 | | |
| 0.2 | % | |
| 30,000 | | |
| 0.2 | % | |
| 30,000 | | |
| 0.2 | % |
| Total Common Stock* | |
| 13,840,226 | | |
| 100.0 | % | |
| 13,499,152 | | |
| 100.0 | % | |
| 13,158,078 | | |
| 100.0 | % |
| * | Percentages, which are rounded to one decimal point, amount to 100% |
| (1) | Under the no redemption scenario, we assume no shares of Common Stock are redeemed. |
| (2) | Under the interim redemption scenario, we assume redemptions of fifty percent (50%) of the remaining shares
of Common Stock are redeemed, amounting to 341,074 shares of Common Stock for aggregate redemption payments of $3.4 million using a per-share
redemption price of $10.00. |
| (3) | Under the maximum redemption scenario, we assume redemptions of the remaining shares of Common Stock,
amounting to 682,148 shares of Common Stock, for aggregate redemption payments of $6.8 million using a per-share redemption price
of $10.00. |
DLQ Investment
On September 5, 2023, DLQ entered into
an agreement with certain institutional investors (the “Investors”) for a $5 million investment in DLQ (the “DLQ
Investment”) in the form of convertible promissory notes issued by DLQ (the “DLQ Notes”). The
DLQ Notes shall convert into such number of shares of common stock of DLQ (the “Conversion Shares”), that would be exchanged
for 1,600,000 Merger Consideration Shares at the Closing. As a condition to the DLQ Investment, the Investors requested an assurance mechanism
from DLQ to protect the Investors in the event they were unable to recoup the full value of the DLQ Investment. DLQ agreed to put into
escrow 1,500,000 Merger Consideration Shares (the “Reset Shares”), which shares would be released to the Investors
to cover any shortfall of the DLQ Investment, up to the maximum amount of Reset Shares. After the Closing of the Business Combination,
once the Investors recoup the DLQ Investment, any remaining Reset Shares not released to the Investors, would be distributed to DLQ Parent
Stockholders as additional Dividend Shares. In addition, approximately 6 million Merger Consideration Shares, not distributed to DLQ Parent
Stockholders, shall be placed in an escrow account until the DLQ Investment has been recouped by the Investors, or all the Reset Shares
have been released.
The DLQ Investment funds were put into
an escrow account and released at Closing to pay certain fees and expenses in connection with the Business Combination, including closing
costs including the deferred underwriter’s fee and for working capital. To the extent not utilized to consummate the Business Combination,
the remaining proceeds from the DLQ Investment and the proceeds from the Trust Account after redemptions will be used for general corporate
purposes, including, but not limited to, working capital for operations, capital expenditures and future acquisitions. Investors have
also received a $5 million convertible note issued by DLQ Parent (the “LGIQ Note”), which shall, at the option
of the Investors, convert into such number of shares of Common Stock of DLQ Parent (“LGIQ Shares”) derived by
dividing $5 million by the volume weighted share price of LGIQ on day before the date of conversion.
Additional Financing After the Closing of the Business
Combination
If the Combined Company needs additional
capital, DLQ, DLQ Parent, Abri, and the Sponsor have agreed that Sponsor shall be the exclusive financing source of capital to fund the
Combined Company after the Business Combination for up to $30 million, which capital shall be sourced by the Sponsor through debt or equity
financings based upon acceptable market conditions available at that time, and upon agreement by the Company and the Sponsor.
Maximum Redemption Calculation
In the above table, the maximum redemption
scenario takes into account the maximum amount of shares for redemption at zero shares of Common Stock and the transaction costs of $3,878,426
(which includes transaction expenses of $2,378,426, plus a deferred underwriting fee of $1,500,000). Abri believes that even after redemptions
in the Maximum Redemption Scenario, it will have sufficient funds to operate the Combined Company. With the funds from the DLQ Investment
the Combined Company will have approximately $1.7 million in cash after paying closing expenses of $3.8 million, including the deferred
underwriter’s fee in connection with the Business Combination. If the Combined Company needs additional capital after the Closing,
the Sponsor shall be the exclusive financing source of capital to fund the Combined Company after the Business Combination for up to $30
million, which capital shall be sourced by the Sponsor through debt or equity financings based upon acceptable market conditions available
at that time, and upon agreement by the Company and the Sponsor.
Interim Redemption Calculation
In the above
table, the interim redemption scenario takes into account an interim redemption of fifty percent (50%) of the remaining shares of Common
Stock available for redemption and the transaction costs of $3,878,426 (which includes transaction expenses of $2,378,426, plus a deferred
underwriting fee of $1,500,000). In such case, this leaves 626,186 shares of Common Stock for an aggregate of $6.3 million (using
a per-share redemption price of $10.00).
For a full analysis
of the potential impact of additional dilution, please see “Potential Impact of Additional Dilution” on page 36.
The diagram below
reflects the ownership of the Combined Company at the closing of the Business Combination:
Does
not give effect to distribution of any Earnout Shares or exercise of the Warrants and represents: (i) no additional redemption of shares
by the Abri public stockholders (ii) interim redemption of shares by the Abri public stockholders, and (iii) maximum redemption of shares
by the Abri public stockholders.
Anticipated Accounting Treatment
The
Business Combination will be accounted for as a “reverse recapitalization” in accordance with U.S. GAAP. A reverse
recapitalization does not result in a new basis of accounting, and the financial statements of the combined entity represent the continuation
of the financial statements of DLQ in many respects. Under this method of accounting, although Abri will issue shares for outstanding
equity interests of DLQ in the Business Combination, Abri will be treated as the “acquired” company for financial reporting
purposes. Accordingly, the Business Combination will be treated as the equivalent of DLQ issuing stock for the net assets of Abri, accompanied
by a recapitalization. For accounting purposes, DLQ will be deemed to be the accounting acquirer in the transaction and, consequently,
the transaction will be treated as a recapitalization of DLQ. The net assets of Abri will be stated at historical cost, with no goodwill
or other intangible assets recorded. Operations prior to the Business Combination will be those of DLQ.
Redemption Rights
Pursuant to our Certificate of
Incorporation, holders of shares of Common Stock may elect to have their shares of Common Stock redeemed for cash at the applicable redemption
price per share equal to the quotient obtained by dividing (i) the aggregate amount on deposit in the Trust Account as of two business days
prior to Closing, including interest (net of taxes payable), by (ii) the total number of then-outstanding shares of Common Stock.
As of September 25, 2023, this would have amounted to approximately $10.68 per share.
Abri shareholders will be entitled to
receive cash for any shares of Abri Common Stock to be redeemed only if they:
(i) (a) hold
shares of Abri Common Stock, or
(b) hold
shares of Abri Common Stock through public Units and elect to separate the public Units into the underlying shares of Abri Common
Stock prior to exercising their redemption rights with respect to the shares of Abri Common Stock; and
(ii) prior
to 5:00 p.m., Eastern Time, on October 19, 2023 (a) submit a written request to Continental that Abri redeem your shares of Abri
Common Stock for cash and (b) deliver your shares of Common Stock to Continental, physically or electronically through DTC.
Holders of outstanding Units must
separate the underlying shares of Abri Common Stock prior to exercising redemption rights with respect to the shares of Abri Common Stock.
If the Units are registered in a holder’s own name, the holder must deliver the certificate for its Units to Continental,
with written instructions to separate the Units into their individual component parts. This must be completed far enough in advance
to permit the mailing of the certificates back to the holder so that the holder may then exercise his, her or its redemption rights upon
the separation of the shares of Abri Common Stock from the Units.
If a holder exercises its redemption rights,
then such holder will be exchanging its shares of Common Stock for cash and will no longer own securities of the Combined Company. Such
a holder will be entitled to receive cash for its shares of Common Stock only if it properly demands redemption and delivers its shares
of Common Stock (either physically or electronically) to Continental in accordance with the procedures described herein. Please see the
section titled “The Meeting — Redemption Rights” for the procedures to be followed if you wish to redeem
your shares of Common Stock for cash.
Vote Required for Approval
The approval of the Business Combination
Proposal, is a condition to Closing. If the Business Combination Proposal is not approved, the Business Combination will not take place.
Approval of the Business Combination Proposal is not a condition to Proposal No. 2.
The Business Combination Proposal (and
consequently, the Merger Agreement and the transactions contemplated thereby, including the Business Combination) will be approved and
adopted only if holders of at least a majority of the issued and outstanding shares of Logiq Common Stock present in person by virtual
attendance or represented by proxy and entitled to vote at the Meeting vote “FOR” the Business Combination Proposal.
As a result, only 52,642,157 shares
of Common Stock held by the Logiq stockholders will need to be present in person by virtual attendance or by proxy to satisfy the quorum
requirement for the meeting. As the vote to approve the Business Combination Proposal is a majority of the votes cast at a meeting at
which a quorum is present, assuming only the minimum number of shares of Common Stock to constitute a quorum is present, only 52,642,157
shares of Common Stock, or approximately 50% of the outstanding shares of the Common Stock held by the Logiq stockholders must vote in
favor of the Business Combination Proposal for it to be approved.
Abri Vote Required for Approval
Pursuant to the Letter Agreement and the
Parent Stockholder Support Agreement, the Initial Stockholders holding an aggregate of 1,728,078 shares (or 72% of the outstanding shares)
of Abri Common Stock have agreed to vote their respective shares of Abri Common Stock (including shares of Common Stock included in the
Private Units) in favor of each of the Proposals and the Abri Special Meeting.
As a result, only no shares of
Abri Common Stock held by the public stockholders will need to be present in person by virtual attendance or by proxy to satisfy the quorum
requirement for the meeting.
Board Recommendation
THE BOARD RECOMMENDS THAT OUR STOCKHOLDERS
VOTE “FOR” ADOPTION OF THE BUSINESS COMBINATION PROPOSAL UNDER PROPOSAL NO. 1.
PROPOSAL
NO. 2 — APPROVE
AND ADOPT AN AMENDMENT TO THE CERTIFICATE OF INCORPORATION TO EFFECT A REVERSE STOCK SPLIT OF OUR COMMON STOCK, AT THE DISCRETION OF THE
BOARD
We
are seeking stockholder approval to grant the Board discretionary authority to amend our Certificate of Incorporation, as amended (such
amendment as shown in Annex E) to effect a reverse stock split of our issued and outstanding shares of common stock, par value
$0.0001 per share, such split to combine a number of outstanding shares of common stock at a ratio of not less than five (5) shares and
not more than fifty (50) shares, into one share of common stock, such ratio to
be determined by our board of directors at any time prior to twelve (12) months from the date of stockholder approval, without further
approval or authorization of our stockholders.
The amendment will not change
the number of authorized shares of common stock, the terms of our common stock or the relative voting power of our stockholders. Because
the number of authorized shares will not be reduced, the number of authorized but unissued shares of our common stock will materially
increase and will be available for reissuance by the Company. The Reverse Stock Split, if effected, would affect all of our holders of
common stock uniformly.
The Board unanimously approved
and recommended seeking stockholder approval of this Proposal on September 25, 2023.
Even if the stockholders approve
the Reverse Stock Split Proposal, we reserve the right not to effect the Reverse Stock Split if the Board does not deem it to be in the
best interests of our stockholders. The Board believes that granting this discretion provides the Board with maximum flexibility to act
in the best interests of our stockholders. If this Reverse Stock Split Proposal is approved by the shareholders, the Board will have the
authority, in its sole discretion, without further action by the shareholders, to effect the Reverse Stock Split during the 12 months
from the date of stockholder approval. If the Reverse Stock Split is not implemented by the Board before October 23, 2024, the Reverse
Stock Split Proposal will be deemed abandoned, without any further effect. In that case, the Board may again seek stockholder approval
at a future date for a Reverse Stock Split if it deems a Reverse Stock Split to be advisable at that time.
The Board’s decision as
to whether and when to effect the Reverse Stock Split will be based on a number of factors, including prevailing market conditions, existing
and expected trading prices for our common stock, and the likely effect of such results on the market price of our common stock.
The Reverse Stock Split is not
being proposed in response to any effort of which we are aware to accumulate our shares of common stock or obtain control of the Company,
nor is it a plan by management to recommend a series of similar actions to our Board or our stockholders. The Reverse Stock Split is not
intended as, and will not have the effect of, a “going private transaction” covered by Rule 13e−3 under the Securities
Exchange Act of 1934, as amended, or the Exchange Act.
There are certain risks associated
with a reverse stock split, and we cannot accurately predict or assure the reverse stock split will produce or maintain the desired results.
See “Certain Risks Associated with a Reverse Stock Split.” However, our Board believes that the benefits to the Company
and our stockholders outweigh the risks and recommends that you vote in favor of granting the Board the discretionary authority to effect
a reverse stock split.
Certain
of our officers and directors have an interest in this Reverse Stock Split as a result of their ownership of shares of stock of the Company,
as discussed in further detail in the section entitled “Beneficial Ownership of Common Stock” set forth below.
Reasons for the Amendment
The primary purpose for effecting
the Reverse Stock Split, should the Board choose to effect one, would be to increase the per share trading price of our common stock.
The Board believes that, should the appropriate circumstances arise, effecting the Reverse Stock Split would, among other things, help
us to:
| |
● |
Appeal to a broader range of investors to generate greater investor interest in the Company; and |
| |
● |
Improve the perception of our common stock as an investment security. |
Appeal to a Broader Range of Investors to Generate
Greater Investor Interest in the Company
An increase in our stock price
may make our common stock more attractive to investors. Brokerage firms may be reluctant to recommend lower-priced securities to their
clients. Many institutional investors have policies prohibiting them from holding lower-priced stocks in their portfolios, which reduces
the number of potential purchasers of our common stock. Investment funds may also be reluctant to invest in lower-priced stocks. Investors
may also be dissuaded from purchasing lower-priced stocks because the brokerage commissions, as a percentage of the total transaction,
tend to be higher for such stocks. Moreover, the analysts at many brokerage firms do not monitor the trading activity or otherwise provide
coverage of lower-priced stocks. Giving the Board the ability to effect a Reverse Stock Split, and thereby increase the price of our common
stock, would give the Board the ability to address these issues if it is deemed necessary.
Improve the Perception of Our Common Stock as an
Investment Security
We believe that our stock price
is undervalued and does not truly reflect the value of our Company due to the lack of visibility. Our Board unanimously approved the discretionary
authority to effect a Reverse Stock Split as one potential means of increasing the share price of our common stock to improve the perception
of our common stock as a viable investment security including in connection with potential acquisition transactions. Lower-priced stocks
have a perception in the investment community as being risky and speculative, which may negatively impact not only the price of our common
stock, but also our market liquidity. In addition, a low stock price may be perceived negatively by vendors, suppliers, and other business
partners.
Criteria to be Used for Determining Whether to
Implement Reverse Stock Split
In determining whether and when
to effect the Reverse Stock Split and which Reverse Stock Split ratio to implement, if any, following receipt of stockholder approval
of this proposal, the Board may consider factors such as:
| |
● |
the historical trading price and trading volume of the common stock; |
| |
|
|
| |
● |
the then-prevailing trading price and trading volume of the common stock and the expected impact of the Reverse Stock Split on the trading market for the common stock in the short- and long-term; |
| |
|
|
| |
● |
the continued listing requirements for the common stock on the applicable exchange and our ability to maintain the listing of our common stock on such exchange; |
| |
|
|
| |
● |
actual and forecasted results of operations, and the likely effect of these results on the market price of common stock; |
| |
|
|
| |
● |
the projected impact of the Reverse Stock Split ratio on trading liquidity in the common stock; |
| |
|
|
| |
● |
the number of shares of common stock outstanding and the potential devaluation of our market capitalization as a result of the Reverse Stock Split; |
| |
|
|
| |
● |
prevailing general market, industry and economic conditions. |
The Board reserves the right
to elect to abandon the Reverse Stock Split, notwithstanding stockholder approval thereof, if our Board determines, in its sole discretion,
that the Reverse Stock Split is no longer in the best interests of the Company and its stockholders. In making such determination, our
Board will take into account certain factors including the expected trading prices for our common stock, actual or forecasted results
of operations and the likely effect of such results on the market price of our common stock, as well as the factors described above.
Certain Risks and Potential Disadvantages Associated
with the Reverse Stock Split
We cannot assure you
that the proposed Reverse Stock Split will increase the price of our common stock.
We expect
that the Reverse Stock Split will increase the market price of our common stock. However, the effect of the Reverse Stock Split on the
market price of our common stock cannot be predicted with any certainty, and the history of reverse stock splits for other companies in
our industry is varied, particularly because investors may view a reverse stock split negatively. It is possible that the per share price
of our common stock after the Reverse Stock Split will not increase in the same proportion as the reduction in the number of outstanding
shares of common stock following the Reverse Stock Split, and the Reverse Stock Split may not result in a per share price that would attract
investors who do not trade in lower-priced securities. In addition, we cannot assure you that our common stock will be more attractive
to investors. Even if we implement the Reverse Stock Split, the market price of our common stock may decrease due to factors unrelated
to the Reverse Stock Split, including our future performance. If the Reverse Stock Split is consummated and the trading price of our common
stock declines, the percentage decline as an absolute number and as a percentage of our overall market capitalization may be greater than
would occur in the absence of the Reverse Stock Split.
The proposed Reverse
Stock Split may decrease the liquidity of our common stock and result in higher transaction costs.
The
Reverse Stock Split may decrease the liquidity of our common stock because fewer shares would be issued and outstanding after the Reverse
Stock Split. In addition, if the Board implements the Reverse Stock Split, more stockholders may own “odd lots” of fewer than
100 shares of common stock, which may be more difficult to sell. Brokerage commissions and other costs of transactions in odd lots are
generally higher than the costs of transactions of more than 100 shares or multiples of 100 shares of common stock. Accordingly, the Reverse
Stock Split may not achieve the desired results of increasing marketability of the common stock as described above.
If the Reverse Stock
Split is approved and effected, the resulting per-share market price may not attract institutional investors or investment funds and may
not satisfy the investing guidelines of such investors and, consequently, the trading liquidity of our common stock may not improve.
While
the Board believes that a higher stock price may help generate investor interest, there can be no assurance that the Reverse Stock Split
will result in a per-share market price that will attract institutional investors or investment funds or that such share price will satisfy
the investing guidelines of institutional investors or investment funds. As a result, the trading liquidity of our common stock may not
necessarily improve.
A decline in the market
price of our common stock after the Reverse Stock Split is approved and effected may result in a greater percentage decline than would
occur in the absence of the Reverse Stock Split.
If the
Reverse Stock Split is approved and effected and the market price of our common stock declines, the percentage decline may be greater
than would occur in the absence of the Reverse Stock Split. The market price of our common stock will, however, also be based upon our
performance and other factors, which are unrelated to the number of shares of common stock outstanding.
Principal Effects of a Reverse Stock Split
If our stockholders approve this
Reverse Stock Split Proposal and the Board elects to effect a Reverse Stock Split, our issued and outstanding shares of common stock would
decrease at a rate of approximately one share of common stock for every five (5)
shares to fifty (50) shares of common stock currently outstanding depending on
the amount of the Reverse Stock Split, at the discretion of the Board. The Reverse Stock Split would be effected simultaneously for all
of our common stock, and the exchange ratio would be the same for all shares of common stock. The Reverse Stock Split would affect all
of our stockholders uniformly and would not affect any stockholder’s percentage ownership interests in the Company. The Reverse
Stock Split would not affect the relative voting or other rights that accompany the shares of our common stock. Common stock issued pursuant
to the Reverse Stock Split would remain fully paid and non-assessable. The Reverse Stock Split would not affect our securities law reporting
and disclosure obligations, and we would continue to be subject to the periodic reporting requirements of the Exchange Act. We have no
current plans to take the Company private. Accordingly, the Reverse Stock Split is not related to a strategy to do so.
In addition to the change in
the number of shares of common stock, a Reverse Stock Split may result in some stockholders owning “odd lots” of less than
100 shares of common stock, which may be more difficult to sell and may cause those holders to incur greater brokerage commissions and
other costs upon sale. A Reverse Stock Split would also have the following effects:
Increase the Per Share Price of our Common Stock
By effectively condensing a number
of pre-split shares into one share of common stock, the per share price of a post-split share is generally greater than the per share
price of a pre-split share. The amount of the initial increase in per share price and the duration of such increase, however, is uncertain.
Increase in the Number of Shares of Common Stock
Available for Future Issuance
By reducing the number of shares
outstanding without reducing the number of shares of available but unissued common stock, the Reverse Stock Split will increase the number
of authorized but unissued shares. The Company may also use authorized shares in connection with the financing of future mergers or acquisitions.
The following table contains
approximate information relating to our common stock, based on share information as of September 25, 2023, and not taking into account
any adjustments related to fractional shares as further described below:
| | |
Current | | |
After Reverse Stock Split if 1:5 Ratio is Selected | | |
After Reverse Stock Split if 1:50 Ratio is Selected | |
| Authorized common stock | |
| 250,000,000 | | |
| 250,000,000 | | |
| 250,000,000 | |
| Common stock issued | |
| 105,284,314 | | |
| 21,056,862 | | |
| 2,105,686 | |
| Common stock outstanding | |
| 105,284,314 | | |
| 21,056,862 | | |
| 2,105,686 | |
| Common stock authorized but unissued | |
| 144,715,686 | | |
| 228,943,138 | | |
| 247,894,314 | |
Although the Reverse Stock Split
would not have any dilutive effect on our stockholders, a reverse stock split without a reduction in the number of shares authorized for
issuance would reduce the proportion of shares owned by our stockholders relative to the number of shares authorized for issuance, giving
our Board an effective increase in the authorized shares available for issuance, in its discretion. Our Board from time to time may deem
it to be in the best interests of the Company and our stockholders to enter into transactions and other ventures that may include the
issuance of shares of our common stock. If our Board authorizes the issuance of additional shares subsequent to the Reverse Stock Split
described above, the dilution to the ownership interest of our existing stockholders may be greater than would occur had the Reverse Stock
Split not been effected. Many stock issuances not involving equity compensation do not require stockholder approval, and our Board generally
seeks approval of our stockholders in connection with a proposed issuance only if required at that time.
Required Adjustment to Currently Outstanding Securities
Exercisable or Convertible into Shares of our Common Stock
A Reverse Stock Split would effect
a reduction in the number of shares of common stock issuable upon the exercise or conversion of our outstanding stock options or warrants
in proportion to the Reverse Stock Split ratio. Additionally, the exercise price of outstanding options or warrants would increase, likewise
in proportion to the reverse stock split ratio.
Require Adjustments to Number of Shares of Common
Stock Available for Future Issuance under our Incentive Plan
In connection with any Reverse
Stock Split, our Board would also make a corresponding reduction in the number of shares available with respect to shares available for
grant granted under our equity incentive plans so as to avoid the effect of increasing the value of options and shares previously granted.
Authorized Shares of Common Stock
The Reverse Stock Split, if effected,
will not change the number of authorized shares of common stock but will increase the number of authorized shares available for future
issuance for corporate needs such as equity financing, mergers or acquisitions, retirement of outstanding indebtedness, stock splits and
stock dividends, employee benefit plans, or other corporate purposes as may be deemed by the Board to be in the best interests of the
Company and its stockholders. The Board believes the increase in available shares for future issuance is appropriate to fund the future
operations of the Company. It will also provide the Company with greater flexibility to respond quickly to advantageous business opportunities
or to make acquisitions using its common stock. As a result, the Company’s current number of authorized shares of common stock may
enable the Company to better meet its future business needs.
We believe that the current amount
of authorized common stock will make a sufficient number of shares available, should the Company decide to use its shares for one or more
of such previously mentioned purposes or otherwise. The Board will also have the ability to issue additional shares of stock without further
vote of the stockholders of the Company, except as provided under the Delaware General Corporation Law or under the rules of any national
securities exchange on which shares of stock of the Company are then listed.
Procedure for Effecting Reverse Stock Split
If the Reverse Stock Split Proposal
is approved by our stockholders, our Board, in its sole discretion, will determine whether such an action is in the best interests of
the Company and our stockholders, taking into consideration the factors discussed above. If our Board believes that the Reverse Stock
Split is in our best interests and the best interest of our stockholders, our Board will then implement the Reverse Stock Split.
Upon approval of the Reverse
Stock Split, we would then file a certificate of amendment to our Certificate of Incorporation with the Secretary of the State of Delaware
at such time as our Board determines is the appropriate effective time to effect the Reverse Stock Split. The certificate of amendment
would add a new provision providing that holders of our common stock immediately prior to the filing of the amendment will receive one
share of common stock for each number of shares as determined by the Board. A copy of the proposed amendment is attached to this proxy
statement as Annex E and is considered a part of this proxy statement. Upon the filing of the certificate of amendment, and without
any further action on the part of the Company or our stockholders, the issued shares of common stock held by stockholders of record as
of the effective date of the Reverse Stock Split would be converted into a lesser number of shares of common stock calculated in accordance
with the Reverse Stock Split ratio of not less than one-for-five (1:5) or not more than one-for-fifty (1:50), as selected by our Board
and set forth in the certificate of amendment.
For example, if a stockholder
presently holds 100 shares of our common stock, he or she would hold 20 shares of common stock following a one-for-five reverse stock
split, or 2 shares of common stock following a one-for-fifty reverse stock split, in each case of fractional share will be rounded up
to the nearest whole number, as described below under “Fractional Shares.” Beginning on the effective date of the Reverse
Stock Split, each certificate representing pre-split shares would be deemed for all corporate purposes to evidence ownership of post-split
shares.
As soon as practicable after
the effective date of the Reverse Stock Split, stockholders would be notified that the Reverse Stock Split had been effected.
Effect on Beneficial Holders (i.e., Stockholders
Who Hold in “Street Name”)
Upon the Reverse Stock Split,
we intend to treat common stock held by stockholders in “street name,” through a bank, broker or other nominee, in the same
manner as stockholders whose shares are registered in their own names. Banks, brokers or other nominees will be instructed to effect the
Reverse Stock Split for their customers holding common stock in “street name.” However, these banks, brokers or other nominees
may have different procedures than registered stockholders for processing the Reverse Stock Split. If you hold shares of common stock
with a bank, broker or other nominee and have any questions in this regard, you are encouraged to contact your bank, broker or other nominee.
Effect on Registered “Book-Entry”
Holders (i.e., Stockholders That are Registered on the Transfer Agent’s Books and Records)
Registered holders of common
stock who hold some or all of their shares electronically in book-entry form with our transfer agent, Nevada Agency and Transfer Company,
do not need to take any action to receive post-Reverse Stock Split shares. If a stockholder is entitled to post-Reverse Stock Split shares,
a transaction statement will automatically be sent to the stockholder’s address of record indicating the number of shares (including
fractional shares) of common stock held following the Reverse Stock Split.
Fractional Shares
No fractional shares will be
issued in connection with the Reverse Stock Split. Stockholders who otherwise would be entitled to receive fractional shares because they
hold a number of shares not evenly divisible by the reverse stock split ratio of the Reverse Stock Split, will be entitled, upon surrender
of certificate(s) representing these shares, to a number of shares of shares rounded up to the nearest whole number and, accordingly,
no money will be paid for a fractional share.
Accounting Matters
The par value of our common stock
would remain unchanged at $0.0001 per share, if a Reverse Stock Split is effected.
The Company’s stockholders’
equity in its consolidated balance sheet would not change in total. However, the Company’s stated capital (i.e., $0.0001 par value
times the number of shares issued and outstanding), would be proportionately reduced based on the reduction in shares of common stock
outstanding. Additional paid in capital would be increased by an equal amount, which would result in no overall change to the balance
of stockholders’ equity.
Additionally, net income or loss
per share for all periods would increase proportionately as a result of a Reverse Stock Split since there would be a lower number of shares
outstanding. We do not anticipate that any other material accounting consequences would arise as a result of a Reverse Stock Split.
Potential Anti-Takeover Effect
Even though a potential Reverse
Stock Split would result in an increased proportion of unissued authorized shares to issued shares, which could, under certain circumstances,
have an anti-takeover effect (for example, by permitting issuances that would dilute the stock ownership of a person seeking to effect
a change in the composition of the Board or contemplating a tender offer or other transaction for the combination of us with another company),
the Reverse Stock Split Proposal is not being proposed in response to any effort of which we are aware to accumulate shares of our common
stock or obtain control of us, nor is it part of a plan by management to recommend a series of similar amendments to our Board and our
stockholders.
No Appraisal Rights
Our stockholders are not entitled
to appraisal rights with respect to a reverse stock split, and we will not independently provide stockholders with any such right.
Material Federal Income Tax Consequences of
the Reverse Stock Split.
The following is a summary of
the material federal income tax consequences of the reverse stock split to holders of our Common Stock and to the Company. This discussion
is based on the Internal Revenue Code of 1986, as amended (the “Code”), existing, proposed and temporary Treasury Regulations
promulgated thereunder, Internal Revenue Service (“IRS”) rulings, administrative pronouncements and judicial decisions in
effect as of the date of this Information Statement, all of which are subject to change (possibly with retroactive effect) or to different
interpretations. The summary does not address all aspects of federal income taxation that may apply to a stockholder as a result of the
Reverse Stock Split and is included for general information only. In addition, the summary does not address any state, local or non-U.S.
income or other tax consequences of the Reverse Stock Split.
The summary does not address
tax consequences to stockholders that are subject to special tax rules, including, without limitation, banks, insurance companies, regulated
investment companies, personal holding companies, non-U.S. entities, nonresident alien individuals, broker-dealers, S corporations, entities
treated as partnerships or partners of such partnerships, persons who acquired our Common Stock pursuant to the exercise of compensatory
stock options, estates, trusts and tax-exempt entities. The summary further assumes that stockholders have held our Common Stock subject
to the Reverse Stock Split as a capital asset within the meaning of Section 1221 of the Code and will continue to hold such common stock
as a capital asset following the Reverse Stock Split. No ruling from the IRS or opinion of counsel will be obtained regarding the federal
income tax consequences to stockholders as a result of the Reverse Stock Split.
THE FOLLOWING DISCUSSION IS BASED
ON CURRENT LAW AND IS NOT INTENDED TO CONSTITUTE A COMPLETE DESCRIPTION OF ALL U.S. FEDERAL INCOME TAX CONSEQUENCES RELATING TO THE REVERSE
STOCK SPLIT. STOCKHOLDERS SHOULD CONSULT THEIR OWN TAX ADVISORS AS TO THE FEDERAL, STATE, LOCAL AND NON-U.S. TAX CONSEQUENCES OF THE REVERSE
STOCK SPLIT IN LIGHT OF THEIR INDIVIDUAL CIRCUMSTANCES. THIS DISCUSSION IS FOR GENERAL INFORMATION ONLY AND DOES NOT CONSTITUTE TAX ADVICE.
We believe that the Reverse Stock
Split, if implemented, would be a tax-free recapitalization under the Code. If the Reverse Stock Split qualifies as a recapitalization
under the Code, then, generally, for United States federal income tax purposes, no gain or loss will be recognized by the Company in connection
with the Reverse Stock Split, and no gain or loss will be recognized by stockholders that exchange their shares of pre-split Common Stock
for shares of post-split Common Stock. The post-split Common Stock in the hands of a stockholder following the Reverse Stock Split will
have an aggregate tax basis equal to the aggregate tax basis of the pre-split Common Stock held by that stockholder immediately prior
to the Reverse Stock Split. Similarly, a stockholder’s holding period for the post-split Common Stock will be the same as the holding
period for the pre-split Common Stock exchanged therefor.
Alternative characterizations
of the Reverse Stock Split are possible. For example, while the Reverse Stock Split, if implemented, would generally be treated as a tax-free
recapitalization under the Code, stockholders whose fractional shares resulting from the Reverse Stock Split are rounded up to the nearest
whole share may recognize gain for federal income tax purposes equal to the value of the additional fractional share. However, we believe
that, in such case, the resulting tax liability may not be material in view of the low value of such fractional interest. Stockholders
should consult their own tax advisors regarding alternative characterizations of the Reverse Stock Split for federal income tax purposes.
THE COMPANY’S VIEW REGARDING
THE TAX CONSEQUENCE OF THE REVERSE STOCK SPLIT IS NOT BINDING ON THE IRS OR THE COURTS. ACCORDINGLY, EACH STOCKHOLDER SHOULD CONSULT WITH
HIS OR HER OWN TAX ADVISORS REGARDING ALL OF THE POTENTIAL TAX CONSEQUENCES TO HIM OR HER OF THE REVERSE STOCK SPLIT.
Interests of Directors and Executive Officers
Our directors and executive officers
have no substantial interests, directly or indirectly, in the matters set forth in this Reverse Stock Split Proposal except to the extent
of their ownership of shares of our common stock.
Reservation of Right to Abandon Reverse Stock Split
We reserve the right to abandon
the Reverse Stock Split without further action by our stockholders at any time before the effectiveness of the filing with the Secretary
of the State of Delaware of the certificate of amendment to our Certificate of Incorporation, even if the authority to effect a Reverse
Stock Split has been approved by our stockholders. By voting in favor of a Reverse Stock Split, you are expressly also authorizing the
Board to delay, not to proceed with, and abandon, a Reverse Stock Split if it should so decide, in its sole discretion, that such action
is in the best interests of the stockholders.
THE BOARD RECOMMENDS THAT YOU VOTE “FOR”
THE REVERSE STOCK SPLIT PROPOSAL UNDER PROPOSAL NO. 2.
PROPOSAL NO. 3 — THE ADJOURNMENT PROPOSAL
The Adjournment Proposal, if adopted,
will approve the chairman’s adjournment of the Meeting to a later date to permit further solicitation of proxies. The Adjournment
Proposal will only be presented to our stockholders in the event, based on the tabulated votes, there are not sufficient votes received
at the time of the Meeting to approve the other Proposals.
Consequences if the Adjournment Proposal is Not Approved
If the Adjournment Proposal is not approved
by our stockholders, the chairman will not adjourn the Meeting to a later date in the event, based on the tabulated votes, there are not
sufficient votes received at the time of the Meeting to approve the Business Combination Proposal.
Vote Required for Approval
This Adjournment Proposal will be approved
and adopted only if holders of at least a majority of the issued and outstanding shares of Common Stock present in person by virtual attendance
or represented by proxy and entitled to vote at the Meeting vote “FOR” the Adjournment Proposal. The Adjournment Proposal
is not conditioned on the approval of any other Proposal set forth in this proxy statement.
Board Recommendation
THE BOARD RECOMMENDS A VOTE “FOR”
ADOPTION OF THE ADJOURNMENT PROPOSAL UNDER PROPOSAL NO. 3.
MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES
The following is a general discussion
of the material U.S. federal income tax consequences (i) of the exercise of redemption rights by U.S. Holders and Non-U.S. Holders
(each, as defined below) of Common Stock, and (ii) of the Business Combination to the U.S. Holder of DLQ Common Stock (i.e.,
DLQ Parent).
This discussion is based on provisions
of the Code, the Treasury Regulations promulgated thereunder (whether final, temporary, or proposed), administrative rulings of the IRS,
and judicial decisions, all as in effect on the date hereof, and all of which are subject to differing interpretations or change, possibly
with retroactive effect. This discussion does not purport to be a complete analysis or listing of all potential U.S. federal income
tax consequences that may apply to a holder as a result of the Business Combination. In addition, this discussion does not address all
aspects of U.S. federal income taxation that may be relevant to particular holders nor does it take into account the individual facts
and circumstances of any particular holder that may affect the U.S. federal income tax consequences to such holder, and accordingly,
is not intended to be, and should not be construed as, tax advice. This discussion does not address the U.S. federal 3.8% Medicare
tax imposed on certain net investment income or any aspects of U.S. federal taxation other than those pertaining to the income tax,
nor does it address any tax consequences arising under any U.S. state and local, or non-U.S. tax laws. Holders should consult
their own tax advisors regarding such tax consequences in light of their particular circumstances.
No ruling has been requested or will be
obtained from the IRS regarding the U.S. federal income tax consequences of the Business Combination or any other related matter;
thus, there can be no assurance that the IRS will not challenge the U.S. federal income tax treatment described below or that, if
challenged, such treatment will be sustained by a court.
This summary is limited to considerations
relevant to holders that hold Common Stock or DLQ Common Stock as “capital assets” within the meaning of section 1221 of the
Code (generally, property held for investment). This discussion does not address all aspects of U.S. federal income taxation that
may be important to holders in light of their individual circumstances, including holders subject to special treatment under the U.S. tax
laws, such as, for example:
| · | banks or other financial institutions, underwriters,
or insurance companies; |
| · | traders in securities who elect to apply a mark-to-market
method of accounting; |
| · | real estate investment trusts and regulated investment
companies; |
| · | tax-exempt organizations, qualified retirement plans,
individual retirement accounts, or other tax-deferred accounts; |
| · | expatriates or former long-term residents of the United States; |
| · | subchapter S corporations, partnerships or other pass-through
entities or investors in such entities; |
| · | dealers or traders in securities, commodities or currencies; |
| · | persons subject to the alternative minimum tax; |
| · | U.S. persons whose “functional currency”
is not the U.S. dollar; |
| · | persons who received shares of Abri Common Stock or
DLQ Common Stock through the issuance of restricted stock under an equity incentive plan or through a tax-qualified retirement plan or
otherwise as compensation; |
| |
· |
persons who own (directly or through attribution) 5% or more (by vote or value) of the outstanding shares of Common Stock or DLQ Common Stock (excluding treasury shares); |
| |
· |
holders holding Common Stock or DLQ Common Stock as a position in a “straddle,” as part of a “synthetic security” or “hedge,” as part of a “conversion transaction,” or other integrated investment or risk reduction transaction; |
| · | controlled foreign corporations, passive foreign investment
companies, or foreign corporations with respect to which there are one or more United States stockholders within the meaning of Treasury
Regulation Section 1.367(b)-3(b)(1)(ii); |
| · | current of former employees of DLQ; or |
| · | recipients of
the Earnout Consideration, including the Sponsor or its affiliates. |
As used in this proxy statement, the term
“U.S. Holder” means a beneficial owner of Abri Common Stock or DLQ Common Stock that is, for U.S. federal income
tax purposes:
| · | an individual who is a citizen or resident of the United States; |
| · | a corporation (or other entity that is classified as
a corporation for U.S. federal income tax purposes) that is created or organized in or under the laws of the United States or
any State thereof or the District of Columbia; |
| · | an estate the income of which is subject to U.S. federal
income tax regardless of its source; or |
| · | a trust (i) if 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 have the authority to control
all substantial decisions of the trust, or (ii) that has a valid election in effect under applicable Treasury Regulations to be treated
as a U.S. person for U.S. federal income tax purposes. |
A “Non-U.S. Holder” means
a beneficial owner of Abri Common Stock or DLQ Common Stock that is neither a U.S. Holder nor a partnership (or an entity or arrangement
treated as a partnership) for U.S. federal income tax purposes.
If a partnership, including for this purpose
any entity or arrangement that is treated as a partnership for U.S. federal income tax purposes, holds Common Stock or DLQ Common
Stock, the U.S. federal income tax treatment of a partner in such partnership will generally depend on the status of the partner
and the activities of the partnership. A holder that is a partnership and the partners in such partnership should consult their own tax
advisors with regard to the U.S. federal income tax consequences of the Business Combination.
Because Units can be separated into
their component parts at the option of the holder, a beneficial owner of a Unit should be treated as the owner of the underlying component
Common Stock and Warrant for U.S. federal income tax purposes. The discussion below with respect to Common Stock should also apply
to holders of Units (as the deemed owner of the underlying component Abri securities (as defined below)).
This summary does not address the tax
consequences of transactions occurring prior to, concurrently with, or after the Business Combination (whether or not such transactions
are in connection with the Business Combinations) including, without limitation, the issuance of Earnout Consideration, Lock-Up Shares,
and the Warrant Revenue Sharing Side Letter. Furthermore, there can be no assurance that changes in the law will not take place which
could affect the United States federal income tax consequences of the Business Combination or that contrary positions may not be
taken by the Internal Revenue Service.
THIS SUMMARY DOES NOT PURPORT TO BE
A COMPREHENSIVE ANALYSIS OR DESCRIPTION OF ALL POTENTIAL U.S. FEDERAL INCOME TAX CONSEQUENCES OF THE BUSINESS COMBINATION. IN
ADDITION, THE U.S. FEDERAL INCOME TAX TREATMENT OF THE BENEFICIAL OWNERS OF COMMON STOCK OR DLQ COMMON STOCK MAY BE AFFECTED BY MATTERS
NOT DISCUSSED HEREIN AND DEPENDS IN SOME INSTANCES ON DETERMINATIONS OF FACT AND INTERPRETATIONS OF COMPLEX PROVISIONS OF U.S. FEDERAL
INCOME TAX LAW FOR WHICH NO CLEAR PRECEDENT OR AUTHORITY MAY BE AVAILABLE. THE HOLDER OF DLQ COMMON STOCK (i.e. DLQ PARENT) SHOULD
CONSULT WITH ITS TAX ADVISORS REGARDING THE PARTICULAR TAX CONSEQUENCES TO THEM OF THE BUSINESS COMBINATION, INCLUDING THE APPLICABILITY
AND EFFECTS OF U.S. FEDERAL, STATE, LOCAL, AND OTHER TAX LAWS.
U.S. Federal Income Tax Consequences to Non-U.S. Holders
The characterization for U.S. federal
income tax purposes of the redemption of a Non-U.S. Holder’s Common Stock as a sale or exchange under Section 302 of the
Code or as a corporate distribution under Section 301 of the Code 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 above, and the corresponding consequences will be as described
below.
Any gain realized by a Non-U.S. Holder
on the redemption of Common Stock that is treated as a sale or exchange under Section 302 of the Code generally will not be subject
to U.S. federal income tax unless:
| · | the gain is effectively connected with a trade or business
of the Non-U.S. Holder in the United States (and, if required by an applicable income tax treaty, is attributable to a United States
permanent establishment or fixed base of the Non-U.S. Holder); |
| · | the Non-U.S. Holder is an individual who is present
in the United States for a period or periods aggregating 183 days or more in the taxable year of the disposition, and certain
other conditions are met; or |
| · | we are or have been a “United States 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 Non-U.S. Holder’s holding period for such Common Stock redeemed, and either (A) shares
of Common Stock are not considered to be regularly traded on an established securities market or (B) such Non-U.S. Holder has
owned or is deemed to have owned, at any time during the shorter of the five-year period preceding such disposition and such Non-U.S. Holder’s
holding period more than 5% of the outstanding shares of Common Stock. There can be no assurance that shares of Common Stock will be treated
as regularly traded on an established securities market for this purpose. |
A non-corporate Non-U.S. Holder described
in the first bullet point immediately above will be subject to tax on the net gain derived from the sale under regular graduated U.S. federal
income tax rates. An individual Non-U.S. Holder described in the second bullet point immediately above will be subject to a flat
30% tax on the gain derived from the sale, which may be offset by certain United States source capital losses, even though the individual
is not considered a resident of the United States, provided that the individual has timely filed U.S. federal income tax returns
with respect to such losses. If a Non-U.S. Holder that is a corporation falls under the first bullet point immediately above, it
will be subject to tax on its net gain in the same manner as if it were a United States person as defined under the Code and, in
addition, may be subject to the branch profits tax equal to 30% (or such lower rate as may be specified by an applicable income tax treaty)
of its effectively connected earnings and profits, subject to adjustments.
If the last bullet point immediately above
applies to a Non-U.S. Holder, gain recognized by such Non-U.S. Holder on the redemption of Common Stock generally will be subject
to tax at generally applicable U.S. federal income tax rates. In addition, we may be required to withhold U.S. income tax at
a rate of 15% of the amount realized upon such redemption. We would generally be classified as a “U.S. real property holding
corporation” if the fair market value of our “United States real property interests” equals or exceeds 50% of the
sum of the fair market value of our worldwide real property interests and our other assets used or held for use in a trade or business,
as determined for U.S. federal income tax purposes. However, we believe that we are not and have not been at any time since our formation
a U.S. real property holding corporation and we do not expect to be a U.S. real property holding corporation immediately after
the Business Combination is completed.
Redemption Treated as Corporate Distribution
With respect to any redemption treated
as a corporate distribution under Section 301 of the Code, provided such dividends are not effectively connected with the Non-U.S. Holder’s
conduct of a trade or business within the United States, Abri will be required to withhold U.S. 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).
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 the 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 above.
This withholding tax does not apply to
dividends paid to a Non-U.S. Holder who provides a Form W-8ECI, certifying that the dividends are effectively connected with
the Non-U.S. Holder’s conduct of a trade or business within the United States. Instead, the effectively connected dividends
will be subject to regular U.S. 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).
Material U.S. Federal Income Tax Consequences of
the Business Combination to Holders of DLQ Common Stock
Subject to the
qualifications, assumptions, and limitations set forth herein and the U.S. federal income tax opinion filed as Annex D herewith,
the following represents the opinion of Feinstein Law, P.C., counsel to DLQ Parent, with respect to the material U.S. federal income tax
consequences of the Business Combination to U.S. Holders of DLQ common stock. If any of the assumptions, representations or covenants
on which the opinion is based is or becomes incorrect, incomplete, inaccurate or is otherwise not complied with, the validity of the opinion
described above may be adversely affected and the tax consequences of the Business Combination could differ from those described herein.
An opinion of counsel is not binding on the IRS or any court, and there can be no certainty that the IRS will not challenge the conclusions
reflected in the opinion or that a court would not sustain such a challenge.
Assuming the
Business Combination is consummated in accordance with the Merger Agreement and as described in this proxy statement/prospectus, it is
the opinion of tax counsel that the Business Combination will qualify as a tax-free reorganization within the meaning of Section
368(a) of the Code, and the U.S. federal income tax consequences of the Business Combination can, in the opinion of tax counsel, be summarized
as follows:
Characterization of
the Business Combination
DLQ and Abri intend that, for U.S. federal
income tax purposes, the Business Combination will qualify as a “reorganization” within the meaning of Section 368(a) of
the Code. In the Merger Agreement, DLQ, Abri, and Merger Sub agree to report the Business Combination as a reorganization unless otherwise
required by applicable law. Neither DLQ nor Abri has requested, and neither intends to request, a ruling from the IRS as to the U.S. federal
income tax consequences of the Merger. No assurance can be given that the IRS will not assert, or that a court would not sustain, a position
that the Business Combination does not constitute a “reorganization.” Accordingly, each U.S. Holder is urged to consult
its tax advisor with respect to the particular tax consequences of the Business Combination to such holder.
Federal Income Tax Considerations
if the Business Combination Qualifies as a Tax-Free Reorganization
If the Business
Combination qualifies as a reorganization, the U.S. Holders of DLQ Common Stock will generally not recognize any gain or loss as
a result of the Business Combination. Pursuant to the Business Combination, the U.S. Holders of DLQ Common Stock will receive shares
of Common Stock in exchange for its shares of DLQ Common Stock. The U.S. Holders of DLQ Common Stock’s tax basis in the shares
of Common Stock received in the Business Combination will be the same as its tax basis in the shares of DLQ Common Stock surrendered in
the Business Combination in exchange therefor. The holding period of the shares of Common Stock received in the Business Combination by
the U.S. Holders of DLQ Common Stock will include the holding period of the shares of DLQ Common Stock surrendered in the Business
Combination in exchange therefor.
Consequences to Holders
of DLQ Common Stock if the Business Combination does not Qualify as a Reorganization
If the Business
Combination fails to qualify as a reorganization within the meaning of Section 368(a) of the Code, then the U.S. Holders
of DLQ Common Stock would recognize gain or loss upon the exchange of its shares of DLQ Common Stock for shares of Common Stock equal
to the difference between the fair market value, at the time of the exchange, of the Common Stock received in the Business Combination
(including any cash received in lieu of a fractional share of Common Stock) and the U.S. Holders of DLQ Common Stock’s tax
basis in the shares of DLQ Common Stock surrendered in the Business Combination. Such gain or loss would be long-term capital gain
or loss if the DLQ Common Stock was held for more than one year at the time of the Business Combination. In addition, the U.S. Holders
of DLQ Common Stock’s aggregate tax basis in the shares of Common Stock received in the Business Combination would equal its fair
market value at the time of Closing, and the U.S. Holders of DLQ Common Stock’s holding period of such shares of Common Stock
would commence the day after Closing.
Information Reporting and Backup Withholding
We generally must report annually to the
IRS and to each holder the amount of cash dividends and certain other distributions we pay to such holder on such holder’s Common
Stock and the amount of tax, if any, withheld with respect to those distributions. In the case of a Non-U.S. Holder, copies of the
information returns reporting those distributions and withholding also may be made available to the tax authorities in the country in
which the Non-U.S. Holder is a resident under the provisions of an applicable income tax treaty or agreement. Information reporting
is also generally required with respect to proceeds from the sales and other dispositions of Common Stock or Warrants to or through the
U.S. office (and in certain cases, the foreign office) of a broker. In addition, certain information concerning a U.S. Holder’s
adjusted tax basis in its Common Stock and Warrants and adjustments to that tax basis and whether any gain or loss with respect to such
securities is long-term or short-term also may be required to be reported to the IRS.
Moreover, backup withholding of U.S. federal
income tax at a rate of 24% generally will apply to cash distributions made on Common Stock and Warrants to, and the proceeds from sales
and other dispositions of such securities by, a U.S. Holder (other than an exempt recipient) who:
| · | fails to provide an accurate taxpayer identification
number; |
| · | is notified by the IRS that backup withholding is required;
or |
| · | in certain circumstances, fails to comply with applicable
certification requirements. |
A Non-U.S. Holder generally may eliminate
the requirement for information reporting (other than with respect to distributions, as described above) and backup withholding by providing
certification of its foreign status, under penalties of perjury, on a duly executed applicable IRS Form W-8 or by otherwise establishing
an exemption.
Backup withholding is not an additional
tax. Rather, the amount of any backup withholding will be allowed as a credit against a U.S. Holder’s or a Non-U.S. Holder’s
U.S. federal income tax liability and may entitle such holder to a refund, provided that certain required information is timely furnished
to the IRS. Holders are urged to consult their own tax advisors regarding the application of backup withholding and the availability
of and procedures for obtaining an exemption from backup withholding in their particular circumstances.
Foreign Account Tax Compliance Act
Under sections 1471 to 1474 of the Code
and the Treasury Regulations and administrative guidance promulgated thereunder (commonly referred to as the “Foreign Account Tax
Compliance Act” or “FATCA”) a 30% withholding tax generally applies with respect to certain dividends
in respect of and, subject to the proposed Treasury Regulations described below, gross proceeds from a sale or disposition of, securities
(including Common Stock and Warrants, hereinafter collectively “Abri securities”) which are held by or through certain foreign
financial institution (including investment funds), unless any such institution (a) enters into, and complies with, an agreement
with the IRS to report, on an annual basis, information with respect to interests in, and accounts maintained by, the institution that
are owned by certain U.S. persons and by certain non-U.S. entities that are wholly or partially owned by U.S. persons and
to withhold on certain payments, or (b) if required under an intergovernmental agreement between the United States and an applicable
foreign country, reports such information to its local tax authority, which will exchange such information with the U.S. authorities.
An intergovernmental agreement between the United States and the applicable foreign country may modify these requirements. Accordingly,
the entity through which Abri securities are held will affect the determination of whether such withholding is required. Similarly, dividends
in respect of, and (subject to the proposed Treasury Regulations discussed below) gross proceeds from the sale or other disposition of,
Abri securities held by an investor that is a non-financial non-U.S. entity that does not qualify under certain exceptions will generally
be subject to withholding at a rate of 30%, unless such entity either (i) certifies to the applicable withholding agent that such
entity does not have any “substantial United States owners” or (ii) provides certain information regarding the entity’s
“substantial United States owners,” which will in turn be provided to the U.S. Department of Treasury.
Under the applicable Treasury Regulations
and administrative guidance, withholding under FATCA generally applies to payments of dividends in respect of Common Stock. While withholding
under FATCA generally would also apply to payments of gross proceeds from the sale or other disposition of securities (including Abri
securities), proposed Treasury Regulations eliminate FATCA withholding on payments of gross proceeds entirely. Taxpayers generally may
rely on these proposed Treasury Regulations until final Treasury Regulations are issued. All holders should consult their tax advisors
regarding the possible implications of FATCA on their investment in Abri securities.
ABRI’S BUSINESS
Overview
Abri was incorporated in Delaware on March 18,
2021 and was formed for the purpose of entering into a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization
or other similar Business Combination with one or more businesses or entities. Abri has until August 12, 2023 to consummate a Business
Combination. If Abri is unable to complete its initial business combination by August 12, 2023 it will (i) cease all operations except
for the purpose of winding up and (ii) as promptly as reasonably possible but not more than ten business days thereafter,
redeem one hundred percent (100%) of the outstanding shares of Common Stock, at a per-shares of Common Stock price, payable in cash, equal
to the aggregate amount then on deposit in the Trust Account, including any interest not previously released to Abri (net of taxes payable),
divided by the number of then outstanding shares of Common Stock, which redemption will completely extinguish public stockholders’
rights as holders of shares of Common Stock (including the right to receive further liquidation distributions, if any), subject to applicable
law. Public stockholders will also forfeit the one-quarter of one Warrant included in the shares of Common Stock being redeemed. As promptly
as reasonably possible following such redemption, subject to the approval of the remaining stockholders and the Board, Abri will dissolve
and liquidate, subject to its obligations under Delaware law to provide for claims of creditors and the requirements of other applicable
law.
Trust Account
Following the closing of the IPO on August 12,
2021 and the Underwriters’ partial exercise of over-allotment option on August 23, 2021, $57,339,200 from the net proceeds
of the sale of the Public Units in the IPO and the sale of the Private Units was placed in the Trust Account maintained by Continental,
acting as trustee. The funds held in the Trust Account is and will be 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 which invest only in direct
U.S. government treasury obligations, so that Abri is not deemed to be an investment company under the Investment Company Act. except
with respect to interest earned on the funds held in the Trust Account that may be released to Abri to pay its income or other tax obligations,
the proceeds will not be released from the Trust Account until the earlier of the completion of a Business Combination or the redemption
of one hundred percent (100%) of the outstanding shares of Common Stock if Abri has not completed a Business Combination in the required
time period. The proceeds held in the Trust Account may be used as consideration to pay the sellers of a target business with which Abri
completes a Business Combination. Any amounts not paid as consideration to the sellers of the target business may be used to finance operations
of the target business. On August 5, 2022, Abri deposited $573,392 into the Trust Account to extend the time to complete a Business
Combination until November 12, 2022. On November 1, 2022, Abri deposited $573,392 into the Trust Account to extend the time to complete
a Business Combination until February 12, 2023.
At the Extension Meeting of Abri’s
stockholders held on December 9, 2022, Abri’s stockholders approved (i) a proposal to amend Abri’s amended and restated
certificate of incorporation, and (ii) a proposal to amend the Management Trust Agreement with the Transfer Agent, to extend the
date by which Abri has to consummate a business combination from February 12, 2023 until August 12, 2023, on an as needed, month-to-month
basis, by depositing an additional $87,500 into the Trust Account for each such one-month extension. Abri may extend the time to complete
a Business Combination for a one-month Extension until August 12, 2023, after which time an additional $525,000 will have been added
to the Trust Account for all six one-month extensions.
On February 6, 2023, March 10, 2023, April
11, 2023, May 11, 2023, June 9, 2023 and July 10, 2023, Abri deposited $87,500 into the Trust Account for each one-month extension (or
a total of $525,000) to extend the time to complete a business combination to August 12, 2023.
On August 7, 2023, Abri held a second
special meeting of shareholders (the “Second Extension Meeting”) In connection with Abri’s Second Extension
Meeting, the stockholders approved a proposal to extend the date to complete a business combination to February 12, 2024 and to remove
the net tangible asset provision in the charter, a total of 570,224 shares were tendered for redemption. Approximately $6.05 was withdrawn
from Abri’s trust account (the “Trust Account”) to pay for the redemption, leaving approximately $7.2
million in the Trust Account as of August 9, 2023.
In connection with the Second Extension
Meeting, 570,224 shares were tendered for redemption. As a result, approximately $6.05 million (approximately $10.62 per share), after
deducting allowable taxes, will be removed from Abri’s trust account to pay such holders. Following redemptions, Abri has 682,148
public shares of common stock outstanding.
Business Combination Activities
On September 9, 2022, Abri entered
into the Merger Agreement. As a result of the transaction, DLQ will become Abri’s wholly owned subsidiary, and Abri will change
its name to “Collective Audience, Inc.” In the event that the Business Combination is not consummated by February 12, 2024,
Abri’s corporate existence will cease and we will distribute the proceeds held in the Trust Account to Abri’s public stockholders.
Redemption Rights
Abri stockholders (except the Initial
Stockholders and the Representative) will be entitled to redeem their shares of Abri Common Stock for a pro rata share of the Trust Account
(currently anticipated to be no less than approximately $10.68 per share of Abri Common Stock for stockholders) net of taxes payable.
The Initial Stockholders and the Representative do not have redemption rights with respect to any shares of Abri Common Stock owned by
them, directly or indirectly.
Automatic Dissolution and Subsequent Liquidation of Trust
Account if No Business Combination
If Abri does
not complete a business combination by February 12, 2024, it will trigger the automatic winding up, dissolution and liquidation pursuant
to the terms of our Certificate of Incorporation. As a result, this has the same effect as if Abri had formally gone through a voluntary
liquidation procedure under Delaware law. Accordingly, no vote would be required from Abri’s stockholders to commence such a voluntary
winding up, dissolution and liquidation. If Abri is unable to consummate its initial business combination within such time period, it
will, as promptly as possible but not more than ten business days thereafter, redeem one hundred percent (100%) of Abri’s
outstanding shares of Common Stock for a pro rata portion of the funds held in the Trust Account, including a pro rata portion of any
interest earned on the funds held in the Trust Account and not necessary to pay its taxes, and then seek to liquidate and dissolve. Public
stockholders will also forfeit the one-quarter of one Warrant included in the shares of Common Stock being redeemed.
The proceeds
deposited in the Trust Account could, however, become subject to claims of our creditors that are in preference to the claims of our public
stockholders. Although Abri will seek to have all vendors, service providers (excluding our independent registered public accounting firm),
prospective target businesses and other entities with which we do business execute agreements with us waiving any right, title, interest
or claim of any kind in or to any monies held in the Trust Account for the benefit of our public stockholders, there is no guarantee that
they will execute such agreements or even if they execute such agreements that they would 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 an 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, Abri 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. 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.
Chardan Capital
Markets has not executed agreements with us waiving such claims to the monies held in the Trust Account. In addition, there is no guarantee
that 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. The Sponsor has agreed that it will be liable
to ensure that the proceeds in the Trust Account are not reduced below $10.00 per Public shares of Common Stock by the claims of target
businesses or claims of vendors or other entities that are owed money by Abri for services rendered or contracted for or products sold
to Abri, but Abri cannot assure that it will be able to satisfy its indemnification obligations if it is required to do so. Abri has not
asked the Sponsor to reserve for such indemnification obligations, nor has Abri independently verified whether the Sponsor has sufficient
funds to satisfy its indemnity obligations and believes that the Sponsor’s only assets are securities of Abri. Therefore, Abri
believes it is unlikely that the Sponsor will be able to satisfy its indemnification obligations if it is required to do so.
In the event
that the proceeds in the Trust Account are reduced below $10.00 per share of Common Stock less taxes payable, and our Sponsor asserts
that it is unable to satisfy its indemnification obligations or that it has no indemnification obligations related to a particular claim,
our independent directors would determine whether to take legal action against our Sponsor to enforce its indemnification obligations.
While Abri currently expects that its independent directors would take legal action on its behalf against Sponsor to enforce its indemnification
obligations to Abri, it is possible that Abri’s independent directors in exercising their business judgment may choose not to do
so in any particular instance. Accordingly, Abri cannot assure you that due to claims of creditors the actual value of the per-share redemption
price will not be less than $10.00 per Unit.
If Abri files
a bankruptcy petition or an involuntary bankruptcy petition is filed against it that is not dismissed, the proceeds held in the Trust
Account could be subject to applicable bankruptcy law, and may be included in its bankruptcy estate and subject to the claims of third
parties with priority over the claims of the public stockholders. To the extent any bankruptcy claims deplete the Trust Account, Abri
cannot assure you it will be able to return $10.00 per share of Common Stock to public stockholders. Additionally, if Abri files a bankruptcy
petition or an involuntary bankruptcy petition is filed against Abri 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 public stockholders. Furthermore,
our Board may be viewed as having breached its fiduciary duty to our creditors and/or may have acted in bad faith, and thereby exposing
itself and Abri to claims of punitive damages, by paying public stockholders from the Trust Account prior to addressing the claims of
creditors. Abri cannot assure you that claims will not be brought against Abri for these reasons.
Each of the Sponsor
and the Representative has agreed to waive its rights to participate in any liquidation of the Trust Account or other assets with respect
to the Private Units they hold.
Facilities
Abri maintains its principal executive
offices at 9663 Santa Monica Blvd., No. 1091 Beverly Hills, CA 90210. An affiliate of Abri’s Chief Executive Officer
is providing this space for a fee of $10,000 per month. Abri considers their current office space adequate for our current operations.
Employees
Abri has three executive officers. These
individuals are not obligated to devote any specific number of hours to its matters and intend to devote only as much time as they
deem necessary to its affairs. Abri presently expects its executive officers to devote such amount of time as they reasonably believe
is necessary to our business (which could range from only a few hours a week while Abri is trying to locate a potential target business
to significantly more time as it moves into serious negotiations with a target business for a business combination). Abri does not intend
to have any full-time employees prior to the consummation of a business combination.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF ABRI
The following
discussion and analysis of Abri’s financial condition and results of operations should be read in conjunction with our audited financial
statements and the notes related thereto which are included elsewhere in this proxy statement. Certain information contained in the discussion
and analysis set forth below includes forward-looking statements. Our actual results may differ materially from those anticipated
in these forward-looking statements as a result of many factors, including those set forth in this report.
The following
discussion and analysis of Abri’s financial condition and results of operations should be read in conjunction with the unaudited
condensed financial statements and the notes thereto contained elsewhere in this proxy statement. Certain information contained in the
discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.
Overview
Abri is a blank
check company incorporated on March 18, 2021 as a Delaware corporation and formed for the purpose of entering into a merger, share
exchange, asset acquisition, stock purchase, recapitalization, reorganization or similar Business Combination with one or more businesses
or IPO and the sale of the Private Placement Units, its capital stock, debt or a combination of cash, stock and debt.
As of June 30,
2024, and the date of this filing, Abri had not commenced operations. All activity for the period from March 18, 2021 (inception)
through March 31, 2023 related to organizational activities, activities necessary to consummate the initial public offering (“IPO”),
and to identify a target company for a business combination. Abri will not generate any operating revenues until after the completion
of the Initial Business Combination, at the earliest. Abri will generate non-operating income in the form of interest income from
the proceeds derived from the IPO.
Abri Management
continues to evaluate the impact of the Russia-Ukraine war on the industry and has concluded that, while it is reasonably possible
that such could have negative effects on the Abri’s financial position, results of its operations, and/or search for a target company,
the specific impacts are not readily determinable as of the date of these financial statements. The financial statements do not include
any adjustments that might result from the outcome of these uncertainties.
On August 12,
2021, simultaneously with the consummation of the IPO, Abri sold to its Sponsor in a Private Placement 276,250 Private Units at a purchase
price of $10.00 per Private Unit, generating gross proceeds to Abri of $2,762,500. The Private Units are identical to the Public Units.
On August 19,
2021, the underwriters notified Abri of their intent to exercise of the over-allotment option in part and, on August 23, 2021,
the underwriters purchased 733,920 additional Units (the “Additional Units”) at $10.00 per Additional Unit upon the closing
of the over-allotment option, generating additional gross proceeds of $7,339,200. On August 23, 2021, simultaneously with the
sale of the Additional Units, Abri consummated the sale of an additional 18,348 Private Units at $10.00 per additional Private Unit (the
“Additional Private Units”), generating additional gross proceeds of $183,480. A total of $7,339,200 of the
net proceeds from the sale of the Additional Units and the Additional Private Units was deposited in the Trust Account, bringing the aggregate
proceeds held in the Trust Account on that date to $57,339,200.
On September 9,
2022, Abri, entered into a Merger Agreement (the “Merger Agreement”) by and among Abri Merger Sub, Inc., a Delaware
corporation and a wholly owned subsidiary of Abri (“Merger Sub”), Logiq, Inc., a Delaware corporation (“DLQ
Parent”) whose common stock is quoted on the OTCQX Market under the ticker symbol, “LGIQ”, and DLQ, Inc., a
Nevada corporation (“DLQ”) and wholly owned subsidiary of DLQ Parent. Pursuant to the terms of the Merger Agreement,
a business combination between the Abri and DLQ will be effected through the merger of Merger Sub with and into DLQ, with DLQ surviving
the merger as a wholly owned subsidiary of Abri (the “Merger”). The board of directors of Abri has (i) approved
and declared advisable the Merger Agreement, the Additional Agreements (as defined in the Merger Agreement) and the transactions contemplated
thereby and (ii) resolved to recommend approval of the Merger Agreement and related transactions by the stockholders of Abri.
The total consideration
to be paid at Closing (the “Merger Consideration”) by Abri to DLQ security holders will be an amount equal to
$114,000,000. The Merger Consideration will be payable in 11,400,000 shares of common stock, par value $0.0001 per share, of Abri
(“Abri Common Stock”).
On December 9,
2022, Abri held a special meeting of stockholders at which such stockholders voted to amend Abri’s amended and restated certificate
of incorporation and its investment trust agreement, giving Abri the right to extend the date by which Abri must complete its Initial
Business Combination up to six times for an additional one month each time, from February 12, 2023 to August 12, 2023, by depositing
$87,500 into the Trust Account for each one-month extension. In connection with the special meeting, 4,481,548 shares of common
stock were tendered for redemption, resulting in redemption payments of $45,952,279 out of the Trust Account. On August 7, 2023, Abri
held a second special meeting of stockholders at which such stockholders voted to amend their amended and restated certificate of incorporation
and investment trust agreement, giving us the right to extend the date by which we must complete our Initial Business Combination from
August 12, 2023 to February 12, 2024 with no additional payment to the Trust Account. As of the date this prospectus is filed, Abri has
made the necessary deposits to extend our Initial Business Combination date to February 12, 2024.
If we have not consummated an initial
business combination by February 12, 2024, we will be required to dissolve and liquidate.
For the Six Months Ended June 30, 2023 and 2022
Results of Operations
Abri’s only activities from March 18,
2021 (inception) through June 30, 2023 were organizational activities, those necessary to consummate the IPO and identify a target
company for a Business Combination. Abri does not expect to generate any operating revenues until after the completion of the Initial
Business Combination. Abri generates non-operating income in the form of interest income on marketable securities held in the Trust Account.
Abri is incurring expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance),
as well as for due diligence expenses.
For the three months ended June 30,
2023, Abri had a net loss of $374,855, which consisted of operating costs of $528,049 and income tax expense of $24,000, offset by a change
in fair value of warrant liabilities of $16,203 and interest income on marketable securities held in the Trust Account of $160,991.
For the three months ended June 30,
2022, Abri had a net loss of $386,732, which consisted of operating costs of $504,605, offset by interest income on cash held in the Trust
Account of $76,629 and a change in fair value of warrant liability of $41,244.
For the six months ended June 30,
2023, Abri had a net loss of $843,539, which consisted of operating costs of $1,105,905 and income tax expense of $48,000, offset by a
change in fair value of warrant liabilities of $7,365 and interest income on marketable securities held in the Trust Account of $303,001.
For the six months ended June 30,
2022, Abri had a net loss of $1,709,339, which consisted of operating costs of $1,900,314, offset by interest income on cash held in the
Trust Account of $81,973 and a change in fair value of warrant liability of $109,002.
Liquidity and Capital Resources
As of June 30, 2023, we had cash
of $148,389 and a working capital deficiency of $2,743,844. As of June 30, 2023, we had marketable securities held in the Trust Account
of $13,650,778 consisting of securities held in a money market fund and government bonds that invests in United States government
treasury bills, bonds or notes with a maturity of 180 days or less. Interest income on the balance in the Trust Account may be used
by us to pay taxes. Through June 30, 2023, we have withdrawn a cumulative amount of $400,000 of interest earned on the Trust Account
to pay our taxes, of which $139,478 has been withdrawn for future tax obligations and is classified as cash as of June 30, 2023.
We intend to use substantially all of the funds held in the Trust Account to acquire a target business and to pay our expenses relating
thereto. To the extent that our capital stock is used in whole or in part as consideration to effect a Business Combination, the remaining
funds held in the Trust Account 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 which we had incurred prior to the completion of our Business Combination if the funds available to us outside
of the Trust Account were insufficient to cover such expenses.
Cash used in operating activities for
the six months ended June 30, 2023 was $261,025. Abri’s operational liquidity needs were primarily satisfied through $400,000
of proceeds from convertible promissory notes from a related party. During the six months ended June 30, 2023, proceeds of $437,500
from non-convertible promissory notes were deposited into the Trust Account, in addition to $303,001 of interest income. Abri expects
that they will need additional capital to satisfy their liquidity needs if we do not consummate the Initial Business Combination prior
to February 12, 2024. Although certain of Abri’s initial stockholders, officers and directors or their affiliates have committed
to loan us funds from time to time or at any time, in whatever amount they deem reasonable in their sole discretion, there is no guarantee
that we will receive such funds.
Off-Balance Sheet Financing Arrangements
Abri has no obligations, assets or liabilities,
which would be considered off-balance sheet arrangements as of June 30, 2023 and December 31, 2022. Abri does not participate
in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest
entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. Abri has not entered into
any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities,
or purchased any non-financial assets.
Contractual Obligations
Abri does not have any long-term debt,
capital lease obligations, operating lease obligations or long-term liabilities other than an agreement to pay our Sponsor a monthly fee
of $10,000 for office space, utilities and secretarial and administrative support. Abri incurred $30,000 and $60,000 of administrative
support fees for the three and six months ended June 30, 2023, respectively. As of June 30, 2023 and December 31,
2022, Abri owed the Sponsor $70,000 and $10,000, respectively, under this agreement, which is included in accounts payable and accrued
expenses in the accompanying condensed balance sheets. Abri began incurring these fees on August 9, 2021 and will continue to incur
these fees monthly until the earlier of the completion of the Business Combination and our liquidation.
In connection with our initial business
combination, Abri is obligated to pay its expenses relating thereto, including the deferred underwriting commissions payable to our underwriter
in an amount equal to 3.0% of the total gross proceeds raised in the offering, or $1,500,000, upon consummation of our initial business
combination.
Upon consummation of our IPO, Abri sold
to our underwriters, for $100, an option to purchase up to a total of 300,000 units (or up to 345,000 if the over-allotment is exercised
in full) exercisable, in whole or in part, at $11.50 per unit, commencing on the consummation of our initial business combination. The
purchase option may be exercised for cash or on a cashless basis, at the holder’s option, and expires five years from the commencement
of sales in our IPO. The option and the 300,000 units, as well as the 300,000 shares of common stock, and the warrants to purchase
300,000 shares of common stock that may be issued upon exercise of the option have been deemed compensation by FINRA and are therefore
subject to a lock-up for a period of 180 days immediately following the effective date of our registration statement, or August 9,
2021.
Critical Accounting Estimates
The preparation
of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent
assets and liabilities at the date of the financial statements, and income and expenses during the periods reported. Actual results could
materially differ from those estimates. We have not identified any critical accounting estimates.
Recent Accounting Standards
Management does
not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect
on our financial statements.
For the Year Ended December 31,
2022 and the Period from March 18, 2021 (inception) through December 31, 2021
Results of Operations
Our only activities
from March 18, 2021 (inception) through December 31, 2022 were organizational activities, those necessary to consummate the
IPO and identify a target company for a Business Combination. Abri does not expect to generate any operating revenues until after the
completion of the Initial Business Combination. Abri generates non-operating income in the form of interest income and gains from
the marketable securities held in the Trust Account, and gains or losses from the change in fair value of the warrant liabilities. We
are incurring expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as
well as for due diligence expenses.
For the year
ended December 31, 2022, we had net loss of $2,500,184, which consisted of operating costs of $3,368,778 mostly from searching a
target company for a business combination and income tax expense of $119,000, offset by interest income on marketable securities held
in the Trust Account of $834,403 and a change in fair value of the warrant liabilities of $153,191.
For the period
from March 18, 2021 (inception) through December 31, 2021, we had a net loss of $1,127,612 which consisted of operating costs
of $1,134,803, offset by interest income on marketable securities held in the Trust Account of $1,299 and a change in fair value of the
warrant liabilities of $5,892.
Liquidity and Capital Resources
As of December 31,
2022, Abri had cash of $381,293 and a working capital deficiency of $1,921,061. As of December 31, 2022, we had marketable securities
held in the Trust Account of $12,841,399 consisting of securities held in a money market fund that invests in U.S. governmental securities
with a maturity of 180 days or less. Interest income on the balance in the Trust Account may be used by us to pay taxes. Through December 31,
2022, we have withdrawn $400,000 of interest earned on the Trust Account to pay our taxes. We intend to use substantially all of the funds
held in the Trust Account to acquire a target business and to pay our expenses relating thereto. To the extent that our capital stock
is used in whole or in part as consideration to effect a Business Combination, the remaining funds held in the Trust Account 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 which we had incurred
prior to the completion of our Business Combination if the funds available to us outside of the Trust Account were insufficient to cover
such expenses.
Cash used in
operating activities for the year ended December 31, 2022 was $716,962. Our operational liquidity needs were primarily satisfied
through $1,250,000 of proceeds from convertible promissory notes from a related party. Abri satisfied liquidity needs arising from redemptions
through a $45,952,279 withdrawal from the trust account. During the year ended December 31, 2022, proceeds of $1,146,784 from non-convertible promissory
notes were deposited into the Trust Account, in addition to $706,687 of interest income. We expect that we will need additional capital
to satisfy our liquidity needs if we do not consummate our Initial Business Combination prior to April 12, 2023. Although certain
of our initial stockholders, officers and directors or their affiliates have committed to loan us funds from time to time or at any time,
in whatever amount they deem reasonable in their sole discretion, there is no guarantee that we will receive such funds.
Accordingly,
the accompanying audited financial statements have been prepared in conformity with accounting principles generally accepted in the United
States of America (“U.S. GAAP”), which contemplate continuation of Abri as a going concern and the realization of assets and
the satisfaction of liabilities in the normal course of business. These financial statements do not include any adjustments that might
result from the outcome of this uncertainty. Further, we have incurred and expect to continue to incur significant costs in pursuit of
our financing and acquisition plans. Management plans to address this uncertainty during period leading up to the Initial Business Combination.
Abri cannot provide any assurance that its plans to raise capital or to consummate an Initial Business Combination will be successful.
Based on the foregoing, management believes that Abri will not have sufficient working capital and borrowing capacity to meet its needs
through the earlier of the consummation of the Initial Business Combination or one year from this filing. These factors, among others,
raise substantial doubt about our ability to continue as a going concern.
Off-Balance Sheet Financing Arrangements
We have no obligations,
assets or liabilities, which would be considered off-balance sheet arrangements as of December 31, 2022 and 2021. We do not
participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable
interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. We have not
entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments
of other entities, or purchased any non-financial assets.
Contractual Obligations
Abri does not
have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities other than an agreement
to pay our Sponsor a monthly fee of $10,000 for office space, utilities and secretarial and administrative support. Abri began incurring
these fees on August 9, 2021 and will continue to incur these fees monthly until the earlier of the completion of the Business Combination
and their liquidation.
In connection
with Abri’s initial business combination, Abri is obligated to pay our expenses relating thereto, including the deferred underwriting
commissions payable to our underwriter in an amount equal to 3.0% of the total gross proceeds raised in the offering, or $1,500,000, upon
consummation of our initial business combination.
Upon consummation
of our IPO, Abri sold to its underwriters, for $100, an option to purchase up to a total of 300,000 units (or up to 345,000 if the over-allotment is
exercised in full) exercisable, in whole or in part, at $11.50 per unit, commencing on the consummation of our initial business combination.
The purchase option may be exercised for cash or on a cashless basis, at the holder’s option, and expires five years from the commencement
of sales in our IPO. The option and the 300,000 units, as well as the 300,000 shares of common stock, and the warrants to purchase
300,000 shares of common stock that may be issued upon exercise of the option have been deemed compensation by FINRA and are therefore
subject to a lock-up for a period of 180 days immediately following the effective date of our registration statement, or August 9,
2021.
Critical Accounting Estimates
The preparation
of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent
assets and liabilities at the date of the financial statements, and income and expenses during the periods reported. Actual results could
materially differ from those estimates. We have not identified any critical accounting estimates.
INFORMATION ABOUT DLQ
In this section and unless the context
otherwise requires, references to “DLQ” refer to (i) for periods prior to Closing, DLQ, Inc., DLQ Inc. and all of its
subsidiaries; and (ii) for periods following Closing, Collective Audience, Inc. as the combined company and all of its subsidiaries.
Overview
DLQ, Inc. is
a Nevada corporation (“DLQ”), originally incorporated in 2019 as Origin8, Inc. On April 15, 2020, its named
was changed to Logiq, Inc. and on August 29, 2022 its name was changed to DLQ, Inc. DLQ is a wholly owned subsidiary of Logiq, Inc.,
a Delaware corporation (“DLQ Parent”), whose common stock is quoted on the OTCQX Market under the ticker symbol,
“LGIQ.” DLQ has three wholly owned subsidiaries, (i) Tamble Inc., a Delaware corporation (“Tamble”),
(ii) Push Interactive, LLC, a Minnesota limited liability company (“Push”), and (iii) BattleBridge
Acquisition Co. LLC, a Nevada corporation (“BattleBridge”) DLQ is headquartered in Minneapolis, Minnesota, USA.
In
addition to DLQ, DLQ Parent also has three other subsidiaries, (i) Rebel AI, Inc., (ii) Fixel AI, Inc., and (iii) Fixel Israel Ltd. (collectively
the “Sister Companies”).
After Closing, the Sister Companies will remain subsidiaries of DLQ Parent and DLQ will not have any ownership of the Sister Companies.
Initially, DLQ was to acquire of all the intellectual property relating to the Fixel’s MarTech Audience Targeting Platform and the
Rebel SMB marketing prior to the Closing of the Business Combination. DLQ has since concluded that due to the complexities related to
the IP transfers and the negligible independent value of such assets, the acquisition of these platforms no longer complement their business
model and an amendment to the Merger Agreement to remove these acquisitions as a condition to closing has been executed.
Acquisition History
In January 2020,
DLQ and DLQ Parent completed the acquisition of substantially all of the assets of Push Holdings, Inc., a Delaware corporation, including
all of the ownership interests in Tamble and Push, making them wholly-owned subsidiaries of DLQ. This business segment has been
rebranded as DataLogiq, which operates as a consumer data management platform powered by lead generation, online marketing, and multi-channel reengagement
strategies through its owned and operated brands. DataLogiq has developed this proprietary data management platform and integrated it
with several third-party service providers to optimize the return on its marketing efforts. DataLogiq focuses on consumer engagement
and enrichment to maximize its return on acquisition through repeat monetization of each consumer through repeat sales or upsales to other
third party service providers. DataLogiq also licenses its software technology and provides managed technology services to various other
e-commerce companies. DataLogiq operations are located in Minneapolis, Minnesota, USA.
On
November 3, 2020, DLQ Parent completed the acquisition of Fixel AI Inc. (“Fixel”), which includes its self-serve MarTech
Audience Targeting platform as a further expansion of the DataLogiq product suite. In
connection with the Business Combination, DLQ and Abri intended for the assets and IP of Fixel to be acquired by DLQ prior to Closing.
After further review, however, DLQ has decided that it will not go through with the acquisition as part of the Business Combination due
to the complexities related to the IP transfers and the negligible independent value of such assets.
On
March 30, 2021, DLQ Parent acquired Rebel AI, Inc., a Delaware corporation (“Rebel”) was acquired to enable small
and medium-sized businesses (“SMBs”) to more effectively compete against larger businesses for new customers
at enterprise scale without the cost. In connection with the Business
Combination, DLQ and Abri intended for the assets and IP of Rebel to be acquired by DLQ prior to Closing. After further analysis, however,
based on the negligible independent value of the assets and minimal business prospects, DLQ has decided that it will not go through with
the acquisition as part of the Business Combination.
On March 31,
2022, BattleBridge, a wholly-owned subsidiary of DLQ, acquired substantially all of the assets of Section 2383, LLC which represents
the “BattleBridge Labs” business (“BattleBridge Labs”) including customer lists and contracts, trade names
and trademarks, marketing resources, proprietary tech and processes, and more. This acquisition allows DLQ to provide full-service branding
and digital marketing agency serving both external clients and other DLQ business units.
A current organizational chart of DLQ
and DLQ Parent is below:
The Diagram below
reflects the post Business Combination and the relationships between existing stockholders in both Abri and DLQ, including DLQ Parent
Stockholders, DLQ Parent and its subsidiaries, which will continue to provide services to the Combined Company after the Business Combination.
Business Developments
On November 8,
2022, DLQ entered into a Managed Services Agreement (the “MSA”) with a significant new client (the “Client”)
and will provide certain affiliate management, website development, lead generation, email management, and search engine optimization
services (collectively, the “Services”) to Client through DLQ’s platform. The MSA will terminate on October 31,
2023, provided that the term may be extended beyond such date by mutual written agreement of the parties. Notwithstanding the foregoing,
Client may terminate the MSA at any time after January 1, 2023, without cost or any penalty, in the event that it is dissatisfied
with the Services provided thereunder.
In connection
with the MSA, on November 8, 2022, DLQ Parent and Client also entered into an Independent Contractor Agreement (the “IC
Agreement,” and together with the MSA, the “Agreements”), pursuant to which Client will provide,
on a non-exclusive basis, certain business development strategies and execution and consulting services regarding e-commerce, digital
marketing, and online advertising, including lead generation, affiliate marketing and brand development to DLQ Parent. The term of the
IC Agreement coincides with the term of the MSA.
As compensation
for the services to be provided by Client to DLQ Parent under the IC Agreement, DLQ Parent agreed to issue Client 1,750,000 restricted
shares of Logiq, Inc. common stock (the “Initial Shares”) upon execution of the Agreements. In the event that
the proposed acquisition of DLQ by Abri SPAC I, Inc., is not completed on or before April 1, 2023, then DLQ shall issue Client an
additional 1,750,000 restricted shares of Logiq, Inc. common stock (such additional shares together with the Initial Shares, the “Registrable
Shares”) as further contingent consideration pursuant to the Agreements.
As a result of
the MSA, Affiliate Management revenue for DLQ was $6,441,775 for the year ended December 31, 2022.
DLQ Current Offering Synopsis:
DLQ aims to provide a successful
outcome for DLQ clients by connecting them to new consumers for their business. DLQ’s primary revenue generating models are the
Push business unit, the BattleBridge business unit and the Rebel business unit.
Push Business Unit
Through Push, DLQ offers two types of
services for clients:
| (1) | Lead generation: DLQ provides their clients with a prospective customer who has demonstrated
an intent to engage with a particular vertical, such as home improvement, or a particular service or product. |
| (2) | Performance Based Engagement: DLQ connects digital marketing traffic from third parties to brands
and service providers, creating a new customer to a client through an e-commerce transaction. This is on a pay-for-performance model. |
Lead Generation
Revenue is primarily generated through
lead generation, which are leads sourced from DLQ owned and operated online brands, and then sold to lead exchanges and other buyers segregated
by market verticals.
Lead data is captured on domains owned
by DLQ, processed through DLQ’s internal and proprietary technology platform named “Marble”. Marble is DLQ’s proprietary
architecture that ingests data from their owned and operated brands as a “Consumer Data Profile”, distributed via Application
Programming Interfaces (“API’s”), and sold within a live data auction.
The data sold based on each of their corporate
customer’s criteria as set forth in their respective contracts.
DLQ utilizes both internal media
and third-party publisher partners to produce digital advertising traffic to Push’s owned and operated brands. This
results in captured consumer data that is sold to lead buyers and lead exchanges.
DLQ
does not utilize a standard or template agreement with set terms for its lead generation services as there are no set prices or terms
that are applicable to all clients. Instead, price is on leads and is set through a bidding process.
Performance Based Engagement
DLQ generates additional revenue through
a pay-for-performance marketing model on select advertisers’ offers. These offers are used as promotions on DLQ’s owned and
operated brands or promoted via third party traffic partners (such as display advertising, email marketing, and social media partners).
These third party traffic partners independently engage in digital marketing efforts to direct targeted web traffic to one of DLQ’s
owned and operated brands. Push is paid on a successful lead or sale with this approach. Success criteria are dependent on the specific
offer, but typically requires that any unique instance of web traffic results in a lead which is subsequently sold by DLQ.
BattleBridge Business Unit
BattleBridge, the agency services business
unit of DLQ, is a full-service branding and digital marketing agency serving both external clients and other DLQ business units. BattleBridge
offers branding and identity development in addition to digital strategy and media buying services, as well as all necessary ancillary
and supporting services to enable the branding and digital practices.
Branding and identity development services
include product and company naming, design and documentation of comprehensive branding standards around graphics, marks, colors, and typestyles,
as well as verbal assets like value propositions, sales language, marketing claims, sales scripts, media releases, and seminal white papers.
Digital strategy and media buying services
include planning, targeting, configuring, and executing all aspects of ad campaigns including design, copy, graphic art, video, music,
promotional tactics, and distribution of ads via targeted media buying. BattleBridge currently uses targeted media buying with talent
and is in process of integrating automation solutions obtained from DLQ’s other business units. Targeted media buying focuses primarily
around Google AdWords, Bing Ads, Facebook, Instagram, TikTok, YouTube, and Amazon, all of which are included in BattleBridge’s services
and talent sets. BattleBridge establishes individual goals with each client and provides periodic reporting based on those goals, often
referencing Return on Ad Spend (“ROAS”) as the primary key performance indicator.
BattleBridge also provides online marketing
services including search engine optimization (“SEO”), content marketing, funnel design and engineering, conversion
optimization, videography, product photography, and email marketing.
DLQ initially intended to add
the Rebel AI business unit as a marketing platform, however due to limitations of its usage and lack of proprietary application, DLQ has
eliminated this platform from its portfolio and will move forward with further developing its BattleBridge platform which provides a subscription
service for small businesses to use advanced marketing and advertising techniques.
Market Opportunity
DLQ participates in the digital advertising
and lead generation markets. For Push, the lead generation market is forecast to grow from $3.1B in 2021 to a $9.6B market by 2028, according
to Mordor Intelligence’s Advertising Services Market report. The digital advertising market for BattleBridge’s addressable
market is expected to grow from US$68B (2021) to US$123B (2026). (Marketing Week, 2021).
Products
Push Business Unit
Marble: Marble
is DLQ’s proprietary architecture that ingests data from their owned and operated brands as a “Consumer Data Profile”.
Marble has been built as an internally facing tool that assembles repeated submissions with a common data point into unified consumer
profiles to track engagement over time and across brands. These profiles are then validated by a series of third-party partners, who provide
scores based on fraud probability, specific accuracy of data points, and the overall profile’s match rate to what resides in existing
major data warehouses. These inputs are utilized to identify trends in captured consumer data, which informs both the traffic’s
sources and brand teams of their ad campaign performance and overall quality of the leads being generated on DLQ owned funnels. These
inputs are utilized to identify trends in captured consumer data, which informs both the traffic’s sources and brand teams of their
ad campaign performance and overall quality of the leads being generated on DLQ owned brands.
Distribution of lead data for sale is
handled through a live auction via a ping-post system. This allows Marble to solicit bids from several buyers for the same record simultaneously,
while protecting the privacy and integrity of the lead until a winning bidder can be selected. Marble’s flexible distribution architecture
allows DLQ to meet the unique requirements of each of their major data buyers and to adapt to new verticals as required throughout the
year.
Outcome: Outcome is a
self-service lead generation marketplace targeting SMB service providers within the United States. Outcome permits these customers
to set specific criteria and pricing goals within the platform and accept delivery of consumer lead data at a regular cadence. This data
is delivered via an API to the customer’s customer relationship management platform (“CRM”) along with
rights to engage the consumer in marketing activities for their specific offering. Customer requests are fulfilled from DLQ’s owned
and operated brand websites primarily derived from web traffic generated by DLQ’s internal agency.
Outcome utilizes a separate database instance
built on the Marble architecture, providing their customers with similar end results that their own team has generated in DLQ’s
lead generation business with Marble’s lead vetting and distribution tools. This shared architecture ensures the same security and
stability infrastructure as their own primary products and services, thereby reducing the scope and improving the efficiencies of DLQ
overhead.
Outcome’s sales process is based
on minimal overhead and rapid turnaround between signup and lead delivery. This addresses many issues DLQ normally experiences through
its traditional lead generation model with integrated agreements and disclaimers, improving onboarding efficiency through a do-it-yourself
(“DIY”) solution, and standardizing delivery process to static CRM endpoints. This enables DLQ to scale up its
sales process to address the inherently broader customer base associated with the SMB versus lead exchange markets.
BattleBridge Business Unit
BattleBridge revenue is derived from services
rather than products. However, some popular services have been productized for ease of selling, notably its “Small Business Advertising”
package at a standard price.
The Small Business Advertising package
is a productized (standardized) offering that enables small businesses to use advanced marketing and advertising techniques for less than
$1,000 per month by documenting concise parameters that enable the agency to deliver compact service packages made economically feasible
by including exactly one campaign, one ad creative, one split test, etc. These accounts have been popular to enable entry level advertising
clients to start out with advertising more cost effectively. DLQ believes that because this is a subscription based model, it will be
more cost effective to develop this product and increase subscription levels which will drive a more sustainable revenue base.
Product Development & Background
Marble, and subsequently Outcome, can
find its roots in early 2019 as an initial project of the Push Interactive entity. This project was intended to facilitate the company’s
transition into the lead generation space, and provide a competitive advantage to their internal team through the unification of disparate
consumer web browsing sessions into unified profiles. These profiles would then be tracked, scored, and over time assemble a dataset to
feed machine learning algorithms to provide increased guidance to both internal media buying teams as well as create better matching and
filtering with lead buying clients.
Throughout 2019 and 2020, Marble began
to take shape through a highly iterative process in close collaboration with its internal team of users. This high communicative environment
allowed for a solution to be custom tailored to DLQ’s internal sales and marketing teams. This tailored solution allowed those teams
to perform well above their baseline without the product, and in the years since, has only become more fitted to the internal requirements
of the DLQ sales and marketing teams.
In 2021, the Marble user interface (“UI”)
required a significant UI update to meet its extended use internally as a list management, SMS/Email marketing, and affiliate tracking
solution. In response, the Product and Engineering teams began experimenting with client facing user interfaces and use cases which would
enable access to higher margin and less concentrated markets.
In late 2021, Outcome had its initial
rudimentary interfaces deployed, and into 2022 the initial batch of clients was onboarded in parallel with the Brands team’s expansion
into deeper and more engaging content funnels in verticals where traditionally flat capture funnels were preferred. This has enabled Outcome
to not only onboard SMB clients more effectively, but also to provide these higher margin/higher ticket clients with more engaged and
purchase-ready consumers.
By eliminating the Rebel AI product suite,
DLQ will focus on increasing subscription based revenue platforms to maximize customer utilization with the objective of building customer
reliance on the services which in turn would result in a more sustainable revenue model.
DLQ Competitive Strengths
DLQ’s competitive strength is founded
and based on their proprietary product suite; Marble and Outcome, The synergistic technologies serve as an outcome-based product suite
across multiple channels and formats, lowering customer acquisition costs at scale.
An additional competitive strength is
DLQ’s capability to generate first party traffic through their owned and operated sites. Through traffic generated by Push’s
internal agency, DLQ has end-to-end control of the consumer experience — from acquisition via digital marketing to internal
utilization or monetization via sale of captured consumer data. This enables DLQ to ensure that all data generated is tied to a specific
experience. The competitive advantage lies in DLQ’s ability to engage consumers in highly controlled and very specific web content
experiences prior to their sale, resulting in higher engagement and conversion rates for their buyers.
Furthermore, DLQ can retain
communication and access rights to these consumers, which enables DLQ to further monetize leads and track repeated consumer site visits
and submissions over time. By increasing the subscription based suite of services, DLQ will gain an advantage in driving down the cost
of acquisition within select verticals, increasing subscription based service offerings as well as being able to quickly identify new
opportunities for brand and vertical development based on consumer interest.
In combination with a competitive advantage
stemming from use of DLQ’s proprietary technology products — Media Buying and Data Management Platform, Marble,
and Outcome, BattleBridge brings years of hands-on customer service and agency experience. Through Platform, BattleBridge can gain
efficiency through automated buying, Through Marble, it can utilize cost saving support, including lead scoring and traffic generation.
Revenue Model
Currently, DLQ has several business areas
that generate revenue under the Push Business Unit and the BattleBridge Business Unit. Revenue generated prior to 2023, was primarily
generated from the Push Business Unit consisting of the following as of December 31 in the following years:
| | |
Point in Time | |
| | |
2022 | | |
2021 | |
| Lead Generation | |
$ | 11,540,265 | | |
$ | 20,862,271 | |
| Affiliate Management | |
| 6,441,775 | | |
| — | |
| Reengagement | |
| 2,253,496 | | |
| 1,929,918 | |
| Revenue | |
$ | 20,235,536 | | |
$ | 22,792,189 | |
Push Business Unit:
The Push business unit creates revenue
in the following major groupings:
| (1) | Lead Monetization: DLQ drives consumers to branded funnels, selling the lead to a variety
of buyers using a managed service auction. This includes: |
(iii) Secondary
Data Sales
| (2) | Reengagement: DLQ drives consumers to advertisers on a performance basis using their
internal media, brand assets or partners. This includes: |
| (i) | Internal media buying as a publisher for advertisers |
| (ii) | Third party traffic partners as publisher for advertisers |
| (3) | Affiliate Revenue: DLQ will generate revenue on the brands that are own and operated
from advertising related activities, such as: |
| (i) | On-website advertising (e.g., banner ads) |
| (ii) | Sponsored content placements (newsletter or content ads) |
| (4) | Subscription Revenue: DLQ captures all of the revenue sectors through the onboarding
of direct buyers, partners, consumers and advertisers through a simple DIY marketplace named Outcome. |
BattleBridge Business Unit:
Among various clients, BattleBridge deploys
two distinct business models, depending on the attributes and parameters of the client opportunity.
| (1) | Percent of Ad Spend: The primary business model for most accounts is the traditional
agency management fee derived as a percentage of Ad Spend (the client’s total advertising budget for one month.) |
| (2) | Shared Revenue Partnership. Fewer clients are engaged under the Shared Revenue
Partnership model; however, these accounts tend to be larger volume accounts, producing a substantial share of the Agency business unit’s
revenue. An example would be client with whom BattleBridge has entered a shared revenue partnership selling nutritional supplements for
beauty, brain health, fitness, and sexual health. BattleBridge established and launched this brand from origin, including establishing
the identity, brand, product lines, packaging, and all e-commerce marketing services. |
Rebel Business Unit: DLQ
charges their advertising customers a percentage of media spend who utilize Platform.
DLQ Strategy
DLQ intends to grow its business by developing
the following strategies that address each of its business units, collectively and separately.
Push Business Unit
Primarily, the Push business unit is engaged
in the larger, enterprise focused lead exchange market. This involves the sale of a high volume of leads to a primary buyer.
Regarding its lead generation business,
DLQ’s growth strategy revolves around a few key goals:
| (1) | Direct Sale of First Party Data. DLQ has begun shifting towards a small and medium sized
business (“SMB”) focused solution to alleviate various issues associated with the lead exchange model. This involves
vertical integration and competing directly with the lead exchanges who currently work with these clients. DLQ has begun to validate the
advantages of working directly with these buyers through DLQ’s initial SMB clients through their product suite. |
| (2) | Expanding DLQ Brands in Additional Verticals. In collaboration with DLQ’s clients,
as well as through growing their industry presence, DLQ has identified several verticals in which to operate. These verticals have and
continue to establish owned and operated brands which provide content experiences that adapt to market feedback and traffic demands. Currently
DLQ is focused on the following verticals for each of its revenue models: |
| (A) | Insurance: DLQ drives consumers to content-related brand content and funnels to compare
and receive quotes from major insurance providers in the following sectors: |
(iii) Life
Insurance
| (B) | Home: DLQ markets around various home service needs to drive consumers to receive quotes
and/or appointments for residential repair, replacement or services such as: |
| (i) | Exterior (e.g. roofing, windows, gutters) |
| (ii) | Interior (e.g. bath, kitchen, general contracting) |
(iii) Accessory
(e.g. security, data, smart home)
| (C) | Lifestyle: DLQ utilizes surveys, polls and questionnaires to deliver highly personalized
content to consumers as a method to improve their well-being or mind-set:. |
(iii) Spiritual
Guidance
(iv) Health
and Wellness
| (D) | Emerging: DLQ drives consumers to up and coming platforms, services and markets such
as solar, electric vehicles, green energy and alternative health. |
| (3) | Diversifying DLQ’s Customer Base: DLQ’s customers primarily consist of lead
exchanges and resellers. These primary buyers may fluctuate seasonally, or in response to market trends. DLQ’s goal is to increase
their buyer base through several initiatives, including: |
| (A) | Identifying and onboarding new buyers in existing verticals. |
In parallel with increased business development,
management is focused on providing additional operational efficiencies to speed up the onboarding process of new clients, such as reducing
any internal process delays around contract approvals, and shifting engineering resources to accommodate customer needs. Management believes
these operational efficiencies will result in the faster turnaround of testing new Lead Exchange buyers.
| (B) | Targeting SMBs for DLQ’s Outcome product. |
DLQ intends to take measures to increase
margins and reduce seasonal volatility with a focus downstream of their current Lead Exchange buyers, to selling more directly to the
end service provider. This removal of a “middle-man” has been identified to result in significantly higher margins and per
lead sale prices with an increased focus on lead quality.
DLQ believes it will gain competitive
advantages by providing more engaged consumer data, and improving its ability to tailor consumer experiences to specific regional/local
buyers (including white-labelling where appropriate). DLQ is already providing the higher contact rates from internal agency traffic these
downstream buyers have required. This is being actively validated with several test clients across three primary verticals (Roofing, Electric
Vehicles, and Medicare) and their feedback has been critical to driving this goal forward. As DLQ expands its downstream buyer pool into
2023, it will further diversify its revenue and customer base.
Finally, as DLQ expands the pool of customers
through a SMB approach, there is also an opportunity to mitigate seasonality through direct relationships with local and regional businesses
which also adapt to seasonality. (e.g. roofing companies that seasonally focus on gutters, ice dams, or other seasonal related services).
The direct relationships DLQ has with these companies also enable DLQ to better understand the offseason sales strategies used by many
of these companies and assist them with building a base of exclusive consumer leads in anticipation of the next season.
| (4) | Integration of Existing DLQ Intellectual Property |
DLQ has a number of platforms and services
which engage in related, but historically separate, services. The goal is to build as much connective tissue between these platforms wherever
it is viable to meet an identified client or market demand.
This is most applicable between Marble
and Outcome. The initial success of Outcome has provided a number of potential areas where the SMB focused self-service platform can provide
additional efficiencies for the Lead Exchange sales team’s processes. DLQ is looking to extend an instance of the Outcome portal
to provide the Lead Exchange sales team with an Outcome for Enterprise model. This primary difference between Outcome and its Outcome
for Enterprise solution will be access to a ping-post live auction system (a system where bids are solicited based on partial data from
multiple buyers and where the highest bid receives the full data record), rather than a strict order and delivery solution favored by
smaller buyers), rather than a strict order and delivery solution favored by smaller buyers. In late 2022, DLQ will begin transitioning
select buyers out of the Lead Exchange Buyer pool into a new Outcome for Enterprise solution. This will allow Outcome clients to engage
in a ping-post bidding process to provide a lower cost, more competitive lead market option.
DLQ will not continue the integration
of Fixel’s consumer engagement algorithms having come to the conclusion that further investment and deployment of resources will
not generate a positive return due to the complexities related to the IP transfers and the negligible independent value of such assets.
BattleBridge Business Unit
BattleBridge’s strategy focuses
on expanding to serve additional clients in growing industries including senior living, medical services, and consumer products for consumers
aged 55 and older. These sectors are attractive to DLQ for the following reasons:
| · | Senior Living: The US senior living market
totaled US$87.4B in 2021 and is forecasted to expand at a compound annual growth rate (“CAGR”) of 5.48% through
2030; driven by a swelling geriatric population growing from 52 million (2018) to more than 95 million (2060). (Grandview
Research, 2021); |
| · | Medical Services: Similarly based on the same
aging population, the medical services market was estimated at US$456.6B in 2021 and forecasted to grow at a CAGR of 5.76% through 2030
to more than US$755B. (Grandview Research, 2022); |
| · | Consumer 55+: Again, based on an aging population,
products designed for consumers 55 and older will expand dramatically in the coming decade. By 2030, seniors are forecast to spend nearly
US$15 Trillion, up from $8.7 Trillion in 2020. (Fengler, 2021). |
Sales & Marketing
Push Business Unit
Push takes an account-based marketing
approach, building and expanding their pool of commercial partners based on established and developing relationships within the lead-generation
industry. DLQ collects feedback directly from customers and prospective customers to garner insights that help drive their decisions around
both business and product development. DLQ testing and validation is handled in real time with their primary in-house user base for Marble,
and in close collaboration with their Outcome customers.
DLQ’s auction-based lead generation
channel along with Outcome’s on-demand lead generation platform provide us with a broad addressable market spanning both enterprises
down through SMB clients. These opportunities are managed by split sales teams between the Lead Exchange (Enterprise) team and the Outcome
(SMB) teams. This allows their sales teams to collaborate through frequent in-house communication, while maintaining independent focuses
and compensation strategies. This ultimately drives towards return-on-investment-positive marketing expenditures across the entire DLQ
sales force.
Further expansion of DLQ’s sales
team will play a critical role in the next phase of their evolution as a company, with key ongoing investments in their team and leadership.
While their products and customer pools continue to scale according to their models, DLQ believes there are significant opportunities
to grow into new markets and verticals in 2023. Increased efforts with both sales and marketing will enable us to capitalize on the continuing
momentum they are building. DLQ expects to expand their resources to grow their personnel and leadership teams to facilitate these longer
term objectives.
BattleBridge Business Unit
BattleBridge uses multiple strategies
to increase revenue by expanding individual client accounts with additional services, and by adding more clients in growing industries.
| · | Sales management estimates that “APAR” (average
per-account revenue) can be increased by migrating to higher pricing models for new accounts and adding additional services to established
accounts. |
| · | Simultaneously, BattleBridge will expand shared revenue
partnerships in the medical and 55+ products channels. Paying based on gross margin (rather than percentage of ad spend) gives this pricing
model a higher upside for long-term growth accounts. |
| · | BattleBridge will also continue to sell new small business
clients into the productized “Small Business Advertising” package discussed above, creating additional revenue. |
DLQ believes that there is an opportunity
to establish cross-selling across the various products and services of all DLQ business units. In addition, DLQ intends to begin group
sales for all DLQ business units, marketing to groups (like trade associations, professional organizations, training bodies, etc.) and
acquiring bundles of customers with a single sales approach.
Markets, Geography, and Seasonality
DLQ’s products and services are
predominantly sold in North America. Based on current and historical balance sheets and statement of operations, it appears that the business
and operations experience seasonality with respect to DLQ’s sales though such seasonality is difficult to predict. Although DLQ
believes its customers’ historical buying patterns and budgetary cycles may be a factor that impacts quarterly sales results, DLQ
is not able to reliably predict its sales based on seasonality because outside factors, such as timing, introduction of new products and
services, and other economic factors impacting DLQ’s industry, can also substantially impact revenues during the year.
Major Customers
Approximately
53% of revenues were generated from two customers and 21% of revenues were generated from three customers during the years ended December
2022 and 2021, respectively In the period ended December 31, 2022, the two customers were Quinstreet and Regal Nutra.
On April 14,
2020, Push Interactive LLC (“Push”) entered into agreement to provide online leads, clicks (non-display), display,
email publishers and call center leads to Quinstreet, Inc. Quinstreet will pay Push for each valid lead within thirty (30) days following
the end of each calendar month. The amount per valid lead owed to Quinstreet is calculated by the platform. The agreement can be terminated
upon three days written notice by either party.
On November 8,
2022, Logiq and BattleBridge Acquisition Co., LLC, a wholly owned subsidiary of Logiq (“Battlebridge”), entered
into a Managed Services Agreement (the “MSA”) with Regal Nutra to provide certain affiliate management, website
development, lead generation, email management, and search engine optimization services (collectively, the “Services”)
through Logiq’s platform. Fees are agreed upon between the parties at the time of the ad placement. The MSA will terminate on October 31,
2023, but may be extended by mutual written agreement. Regal Nutra may terminate the MSA at any time after January 1, 2023, without
cost or any penalty, in the event that it is dissatisfied with the Services provided.
Research & Development
DLQ engages in a continuous review process
of both customer and internal feedback to identify new and validate existing research and development (“R&D”)
projects. DLQ engages in a rapid prototyping and discovery process to identify new feature-functionality within their products. Utilizing
low and high-fidelity prototyping, customer interviews, and internal ticketing systems to collect feedback, DLQ is engaged in continual
iteration and improvement of its product offerings. These prototypes are then reviewed by a committee consisting of marketing, sales,
engineering, and product team members and an R&D initiative is added to their roadmap. All R&D initiatives require the establishment
of clear and measurable success criteria as part of their introduction into the product roadmap.
Current items in the R&D include:
| (1) | Outcome to onboard new SMB client demand: In order to provide additional stability and higher
margins within each vertical, DLQ will continue to develop a deeper pool of more regional, direct or specialized buyers through the Outcome
platform. The primary issue around this is the onboarding and management process to improve time to market. |
| (2) | Hyper-verticalization to deepen customer relationship: DLQ will create more value, data
and revenue by going deeper into active markets. The deeper DLQ dives into a vertical the more they engage with consumers, allowing them
to stay in touch with how they will consume media in the future. These strategies include: |
| (i) | Deepening owned and operated brands and consumer experiences |
| (ii) | Writing insurance policies |
| (iii) | Accepting payment for home services |
| (3) | Improve customer acquisition strategy for DLQ agencies: DLQ can acquire additional traffic
through new channels or methods not currently addressed. In addition, DLQ can improve traffic performance by targeting consumers within
a vertical in which they already participate. These include: |
| (i) | Expansion of traffic sources (such as TikTok and connected television) |
| (ii) | Content Based Engagement (such as search engine optimization and contextual ad targeting) |
(iii) Lead Nurturing
(such as engagement through mobile apps)
| (4) | Core Expansion of DLQ’s Customer Data Platform (“CDP” which
includes Marble and Outcome): DLQ is accelerating the acquisition of first-party data in order to increase the margins around its brands.
This will require a more robust intent identification solution that can assemble pools of consumers for use in both online and offline
channels. This will expand the following functionality of the Marble platform: |
| (i) | Consumer Identification |
Competition
DLQ’s business is rapidly evolving
and becoming more competitive in the digital transformation phase of the Internet. Its current and potential direct competitors include:
(i) advertising companies, web design firms and other digital marketing companies; (ii) a number of indirect competitors, include
media companies, web portals, comparison shopping websites, and web search engines, either directly or in collaboration with SMBs and
(iii) larger public companies such as:
| (i) | Results-based advertising: Adtheorent (“ADTH”) |
| (ii) | Consumer Engagement: Braze (“BRZE”), Quinstreet (“QNST”)
and EverCommerce (“EVCM”) |
| (iii) | Verticalized: Cardlytics (“CDLX”) and Porch Group (“PRCH”) |
DLQ believes that the principal competitive
factors in the digital marketing business include ease of use, access to high quality first and third party traffic, affordability, and
broad range of functionality. Many of its current and potential competitors have greater resources, longer histories, more customers,
and greater brand recognition. DLQ may adopt more aggressive pricing and devote more resources to technology, functionality and ease of
use and marketing. Other companies also may enter into business combinations or alliances that strengthen their competitive positions.
DLQ faces competition principally from
regional players that operate across several markets in the U.S. DLQ also faces competition from single-market players.
DLQ competes to attract, engage, and retain
buyers based on the variety and value of products and services listed on its marketplace. DLQ also competes to attract and retain sellers
based on the number and engagement of buyers, the effectiveness and value of the marketing services offered, commission rates, and the
usefulness of the services provided including data and analytics for potential buyer targeting and the availability of support services.
Intellectual Property
DLQ has acquired the rights to Patent
# 10,756,898 issued August 25, 2020 for content delivery verification.
DLQ has acquired the rights to 12 unregistered
trademarks and trade names including “DLQ, Inc.” and “DataLogiq.”
Government Approval
DLQ does not believe that any government
agency approval is required for the products and services that they provide to DLQ’s customers.
Government Regulations
DLQ and their clients currently use pseudonymous
data about Internet and mobile app users on the platform to manage and execute digital advertising campaigns in a variety of ways, including
delivering advertisements to end users based on their geographic locations, the type of device they are using, their interests as inferred
from their web browsing or app usage activity, or their relationships with DLQ clients. Such data is passed to DLQ from third parties,
including original equipment manufacturers, application providers, and publishers. DLQ does not use this data to discover the identity
of individuals, and DLQ currently prohibits clients, data providers and inventory suppliers from importing data that directly identifies
individuals onto the platform.
DLQ’s ability, like those of other
advertising technology companies, to collect, augment, analyze, use and share data relies upon the ability to uniquely identify devices
across websites and applications, and to collect data about user interactions with those devices for purposes such as serving relevant
ads and measuring the effectiveness of ads. The processes used to identify devices and similar and associated technologies are governed
by U.S. and foreign laws and regulations and dependent upon their implementation within the industry ecosystem. Such laws, regulations,
and industry standards may change from time to time, including those relating to the level of consumer notice, consent and/or choice required
when a company employs cookies or other electronic tools to collect data about interactions with users online.
In the U.S., both federal and state
legislation govern activities such as the collection and use of data, and privacy in the advertising technology industry has frequently
been subject to review by the Federal Trade Commission (the “FTC”), U.S. Congress, and individual states.
Much of the federal oversight on digital advertising in the U.S. currently comes from the FTC, which has primarily relied upon Section 5
of the Federal Trade Commission Act, which prohibits companies from engaging in “unfair” or “deceptive” trade
practices, including alleged violations of representations concerning privacy protections and acts that allegedly violate individuals’
privacy interests. However, there is increasing consumer concern over data privacy in recent years, which has led to a myriad of
proposed legislation and new legislation both at the federal and state levels, some of which has affected and will continue to affect
DLQ’s operations and those of their industry partners. For example, the California Consumer Privacy Act of 2018 (the “CCPA”),
which went into effect January 1, 2020, defines “personal information” broadly enough to include online identifiers provided
by individuals’ devices, applications, and protocols (such as IP addresses, mobile application identifiers and unique cookie identifiers)
and individuals’ location data, if there is potential that individuals can be identified by such data.
The CCPA creates individual data privacy
rights for consumers in the State of California (including rights to deletion of and access to personal information), imposes special
rules on the collection of consumer data from minors, creates new notice obligations and new limits on and rules regarding the “sale”
of personal information (interpreted by many observers to include common advertising practices), and creates a new and potentially severe
statutory damages framework for violations of the CCPA and for businesses that fail to implement reasonable security procedures and practices
to prevent data breaches. The CCPA also offers the possibility to a consumer to recover statutory damages for certain violations and could
open the door more broadly to additional risks of individual and class-action lawsuits even though the statute’s private right of
action is limited in scope. There have been many class action lawsuits filed invoking the CCPA outside of the private right of action
provided for by the law. It is unclear at this point whether any of these claims will be accepted by the courts. In addition, the California
Privacy Rights Act (“CPRA”), recently passed, which will impose additional notice and opt out obligations on
the digital advertising space, including an obligation to provide an opt out for behavioral advertising. When the CPRA goes into full
effect in January 2023, it will impose additional restrictions on DLQ and on their industry partners; it is difficult to predict
with certainty the full effect of the CPRA and its implementing regulations on the industry.
As the collection and use of data for
digital advertising has received media attention over the past several years, some government regulators, such as the FTC, and privacy
advocates have suggested creating a “Do Not Track” standard that would allow Internet users to express a preference, independent
of cookie settings in their browser, not to have their online browsing activities tracked. The CPRA similarly contemplates the use of
technical opt outs for the sale and sharing of personal information for advertising purposes as well as to opt out of the use of sensitive
information for advertising purposes, and allows for AG rulemaking to develop these technical signals. If a “Do Not Track,”
“Do Not Sell,” or similar control is adopted by many Internet users or if a “Do Not Track” standard is imposed
by state, federal, or foreign legislation (as it arguably is to some degree under the CCPA regulations), or is agreed upon by standard
setting groups, DLQ may have to change its business practices, DLQ’s clients may reduce their use of the platform, and DLQ’s
business, financial condition, and results of operations could be adversely affected.
Furthermore, additional governmental regulations,
including foreign governmental regulations, may affect DLQ’s business. For more information, see the section titled “Risk
Factors”.
Environmental Matters
To date, no significant pollution or other
types of hazardous emission have resulted from DLQ’s operations, and it is not anticipated that their operations will be materially
affected by federal, state or local provisions concerning environmental controls. DLQ’s costs of complying with environmental health
and safety requirements have not been material.
Furthermore, compliance with federal,
state and local requirements regulating the discharge of materials into the environment, or otherwise relating to the protection of the
environment, have not had, nor are they expected to have, any material effect on the capital expenditures, earnings or competitive position
of DLQ. However, they will continue to monitor emerging developments in this area.
Employees
As of December 31,
2022, DLQ had 23 employees and contractors in North America. None of DLQ’s employees are represented by a labor union or covered
by a collective bargaining agreement.
DLQ believes
that their future success will depend, in part, on DLQ’s ability to continue to attract, hire, and retain qualified personnel.
Facilities
DLQ’s primary office is located
at 225 Thomas Ave N in Minneapolis, Minnesota. The lease for the 12,422 sq. foot office and warehouse space is at a rate of $17,500 per
month and expires on December 31, 2022; however, the lease was extended from January 1, 2023 through April 30, 2023, and is no longer
leased.
Legal Proceedings
From time to time, DLQ may be a party
to legal proceedings or subject to claims arising in the ordinary course of business. DLQ is not currently a party to any legal proceeding
that is likely to have a material adverse effect on its business, financial condition or operations.
Other than as described in the preceding
paragraph, DLQ is not aware of any other material, existing or pending legal proceedings against DLQ, nor is DLQ involved as a plaintiff
in any material proceeding or pending litigation.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF DLQ
You should read the following discussion
and analysis of DLQ’s financial condition and results of operations together with the “Selected Consolidated Financial Data”
section of this proxy statement and DLQ’s consolidated financial statements and the related notes appearing at the end of this joint
proxy statement. Some of the information contained in this discussion and analysis or set forth elsewhere in this proxy statement, including
information with respect to DLQ’s plans and strategy for its business and related financing, includes forward-looking statements
that involve risks and uncertainties. As a result of many factors, including those factors set forth in the “Risk Factors”
section of this proxy statement, DLQ’s actual results could differ materially from the results described in or implied by the forward-looking
statements contained in the following discussion and analysis. In this section and unless the context otherwise requires, references to
“DLQ” refer to DLQ, Inc., DLQ Inc. and all of its subsidiaries.
Overview
DLQ, Inc. is
a Nevada corporation (“DLQ”), originally incorporated in 2019 as Origin8, Inc. On April 15, 2020, its name
was changed to Logiq, Inc. and on August 29, 2022 its name was changed to DLQ, Inc. DLQ is a wholly owned subsidiary of Logiq, Inc.,
a Delaware corporation (“Logiq, Inc.”), whose common stock is quoted on the OTCQX Market under the ticker symbol,
“LGIQ.” DLQ has three wholly owned subsidiaries, (i) Tamble Inc., a Delaware corporation (“Tamble”),
(ii) Push Interactive, LLC, a Minnesota limited liability company (“Push”), and (iii) Battle Bridge
Acquisition Co. LLC, a Nevada corporation (“BattleBridge”). DLQ is headquartered in Minneapolis, Minnesota,
USA.
Tamble, Inc.
is not an operating business. Its sole purpose is to hire independent contractors for Logiq’s marketing business.
On January 8,
2020, DLQ completed the acquisition of substantially all of the assets of Push Holdings, Inc. This acquired business operates a consumer
data management platform powered by lead generation, online marketing, and multichannel reengagement strategies through its owned and
operated brands. DLQ has developed a proprietary data management platform and integrated with several third-party service providers
to optimize the return on its marketing efforts. DLQ focuses on consumer engagement and enrichment to maximize its return on acquisition
through repeat monetization of each consumer. As part of the transaction, Logiq, Inc. issued 35,714,285 shares to Conversion
Point Technologies, Inc. as consideration for the acquisition of all the assets of Push Holdings, Inc. in the amount of $14,285,714.
On March 31,
2022, DLQ completed the acquisition of certain customer contractual agreements of Battle Bridge Labs, LLC, including those of Section 2383
LLC, a Tulsa, Oklahoma-based digital brand marketing agency. The purchase price was $2,929,612 and consisted of the issuance of 2,912,621 shares
of restricted common stock of Logiq, Inc. with a fair value of $2,679,612 and cash consideration of $250,000, of which Logiq, Inc. paid
$200,000 and DLQ paid $50,000.
Battle Bridge
Acquisition Co., LLC became the third wholly owned subsidiary of DLQ. Battle Bridge is a full-service branding and digital marketing
agency serving both external clients and internal parts of DLQ. Battle Bridge offers branding and identity development in additional to
digital strategy and media busing services, as well as all of the requisite ancillary and supporting services to enable the branding and
digital practices.
Carve-Out Consolidated Results of Operations for
the three months ended March 31, 2023 and 2022
Carve-Out Consolidated Results of Operations
The following is a comparative discussion
of DLQ’s Consolidated Results of Operations for the three months ended June 30, 2023, and 2022. The consolidated results include
DLQ, Inc. and its two wholly owned subsidiaries, Tamble, Inc. and Push Interactive, LLC. Tamble, Inc. is not an operating business.
Its sole purpose is to hire independent contractors for Logiq and DLQ’s marketing business.
| | |
For the six months ended | |
| | |
June 30,
2023 | | |
June 30,
2022 | | |
Change | |
| Revenue | |
$ | 8,398,088 | | |
| 100.0 | % | |
$ | 8,068,303 | | |
| 100.0 | % | |
$ | 329,785 | | |
| 4.1 | % |
| Platform operations | |
| 7,582,899 | | |
| 90.3 | | |
| 5,877,152 | | |
| 72.8 | | |
| 1,705,747 | | |
| 29.0 | |
| Depreciation and amortization | |
| 777,447 | | |
| 9.3 | | |
| 632,238 | | |
| 7.8 | | |
| 145,209 | | |
| 23.0 | |
| General and administrative | |
| 2,481,585 | | |
| 29.5 | | |
| 2,993,183 | | |
| 37.1 | | |
| (511,598 | ) | |
| (17.1 | ) |
| Sales and marketing | |
| 60,000 | | |
| 0.7 | | |
| 607,496 | | |
| 7.5 | | |
| (547,496 | ) | |
| (90.1 | ) |
| Total operating expenses | |
| 10,901,931 | | |
| 129.8 | | |
| 10,110,069 | | |
| 125.3 | | |
| 791,862 | | |
| 7.8 | |
| Loss from operations | |
| (2,503,843 | ) | |
| (29.8 | ) | |
| (2,041,766 | ) | |
| (25.3 | ) | |
| (462,077 | ) | |
| 22.6 | |
| Other (Expenses)/Income, net | |
| (85,673 | ) | |
| (1.0 | ) | |
| (2,644 | ) | |
| (0.0 | ) | |
| (83,029 | ) | |
| 3,140.3 | |
| Net Loss before income tax | |
| (2,589,516 | ) | |
| (30.8 | ) | |
| (2,044,410 | ) | |
| (25.3 | ) | |
| (545,106 | ) | |
| 26.7 | |
| Income tax expense | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | |
| Net Loss | |
$ | (2,589,516 | ) | |
| (30.8 | )% | |
$ | (2,044,410 | ) | |
| (25.3 | )% | |
$ | (545,106 | ) | |
| 26.7 | % |
Revenue
Revenues for the six months ended June
30, 2023 and 2022 were essentially flat at $8,398,088 and $8,068,303, respectively; however, the revenue mix changed between the two periods
as shown by the table below:
| | |
Period ending June 30, | |
| | |
2023 | | |
2022 | |
| | |
(unaudited) | | |
(unaudited) | |
| Lead Generation | |
$ | 1,442,787 | | |
$ | 6,746,797 | |
| Affiliate Management | |
| 6,731,379 | | |
| — | |
| Reengagement | |
| 223,922 | | |
| 1,321,506 | |
| Revenue | |
$ | 8,398,088 | | |
$ | 8,068,303 | |
ending June 30, 2022 to June 30, 2023.
The decrease in lead generation and reengagement revenue was a direct result of the Company’s current working capital constraints
reducing its ability to place ads on behalf of clients. Once the working capital constraints are alleviated, the lead generation and reengagement
revenues are expected to return to historical levels. Sufficient working capital will allow DLQ to increase vendor credits and improve
trade payable terms, which are primary factors in driving lead generation and reengagement revenue.
With the closing of this Business Combination,
the funding of the PIPE, and a senior exchange listing (due to access to broader institutional capital and preferential vendor credit
terms which are often much more favorable for senior exchange-listed entities in DLQ’s industry) are all key factors in alleviating
the working capital constraints and providing sufficient working capital to return the lead generation and reengagement revenue to its
historical levels.
Affiliate management revenue increased
by $6,731,379 from the period ending June 30, 2022 to June 30, 2023 primarily due to the success of onboarding the first customer for
the affiliate management program. This is the customer entered into a Management Services Agreement (MSA) with the Company during Q4 of
2022.
Other Income/(Expenses)
Other expenses were $85,673 and $2,644
for the six months ended June 30, 2023 and 2022, respectively. The increase in other expenses was due to the fees and expenses related
to the receivable factoring for the six months ended June 30, 2023 as compared the six months ended June 30, 2022.
Operating Expenses
Platform Operations
Platform Operations was $7,582,899 and
$5,877,152 for the six months ended June 30, 2023 and 2022, respectively. The increase in platform operations from June 30, 2022 to June
30, 2023 was due to the increase in the affiliate management revenue as a percentage of overall revenue. Affiliate management is more
labor intensive than the lead generation business which requires very little overhead. For the six months ended June 30, 2022, there was
approximately $6,746,797 of lead generation revenue, or 83.6% of total revenue, compared to no revenue for the affiliate management business.
For the six months ended June 30, 2023, there was $6,731,379 of affiliate management revenue, or 80.2% of total revenue, compared to $1,442,787
of lead generation revenue. While the overall revenue increased between the six months ended June 30, 2023 and 2022, the platform cost
to obtain the same revenue increased.
Sales and Marketing (S&M)
S&M expense was $60,000 and $607,496
for the six months ended June 30, 2023 and 2022, respectively. The decrease is mainly due to the drop in sales commissions due to
lower sales activity and sales results in the lead generation and reengagement business. The affiliate management business does not require
sales commissions to be paid.
General and Administrative (G&A)
General and administrative expenses were
$2,481,585 and $2,993,183 for the six months ended June 30, 2023 and 2022, respectively. The reduction of expenses between June 30,
2023 and 2022, respectively, was primarily due to a reduction in headcount.
Loss from operations
The Company posted a loss from operations
of $(2,503,843) and $(2,041,766) for the six months ended June 30, 2023 and 2022, respectively. The increased loss was primarily
due to the increase in platform expenses partially offset by a reduction in sales and marketing costs as well as a reduction in headcount
for the six months ended June 30, 2023.
Net loss before income tax
The Company posted a net loss before income
tax $(2,589,516) and $(2,044,410) for the six months ended June 30, 2023 and 2022, respectively.
The increased loss was primarily due to
the increase in platform expenses partially offset by a reduction in sales and marketing costs, and a reduction in headcount for the six
months ended June 30, 2023.
Consolidated income tax expense
No provision
for corporate taxes is made as DLQ incurred a loss and has unutilized loss carry forwards.
Net loss
The Company posted a consolidated net
loss of $(2,589,516) for the six months ended June 30, 2023 as compared to a net loss of $(2,044,410) for the six months ended June 30,
2022. The increased loss was primarily due to the increase in platform expenses partially offset by a reduction in sales and marketing
costs, and a reduction in headcount for the six months ended June 30, 2023.
Known Trends or Uncertainties
We have seen
some consolidation in the mobile applications industry during economic downturns. These consolidations have not had a negative effect
on our total sales; however, should consolidations and downsizing in the industry continue to occur, those events could adversely impact
our revenues and earnings going forward.
We believe that
the need for improved productivity in the research and development activities directed toward developing new and enhanced PaaS applications
will continue to result in SMBs utilizing our products and services. New product developments could result in increased revenues and earnings
if they are accepted by our markets; however, there can be no assurances that new products will result in significant improvements to
revenues or earnings. For competitive reasons, we do not disclose all of our new product development activities.
The potential
for growth in new markets is uncertain. We will continue to explore these opportunities until such time as we either generate sales or
determine that resources would be more efficiently used elsewhere.
Inflation
We have not been
affected materially by inflation during the periods presented, and no material effect is expected in the near future.
Contractual Obligations and Commitments
We have no material
contractual obligations as of June 30, 2023.
Critical Accounting Policies
and Estimates
Our critical
accounting policies and estimates are included in Note 2 — “Summary of Significant Accounting Policies”
of Notes to Consolidated Financial Statements included in this Annual Report.
Recently Issued or Newly Adopted
Accounting Standards
Our recently
issued or newly adopted accounting standards are included in Note 2 — “Summary of Significant Accounting Policies”
of the Notes to Consolidated Financial Statements included in this Annual Report.
Off-Balance Sheet Arrangements
As of June 30,
2023, we did not have any relationships with unconsolidated entities or financial partnerships, such as entities often referred to as
structured finance or special purpose entities, which would have been established for the purpose of facilitating off-balance sheet
arrangements or other contractually narrow or limited purposes. As such, we are not materially exposed to any financing, liquidity, market,
or credit risk that could arise if we had engaged in such relationships.
We do not have
relationships or transactions with persons or entities that derive benefits from their non-independent relationship with us or our
related parties.
| | |
For the Six Months Ended
June 30, | |
| Cash flows: | |
2023 | | |
2022 | |
| Net cash used in operating activities | |
$ | (1,055,651 | ) | |
$ | (411,988 | ) |
| Net cash used in investment activities | |
$ | — | | |
$ | (50,000 | ) |
| Net cash provided by (used in) financing activities | |
$ | 1,113,855 | | |
$ | (333,436 | ) |
Operating Activities
During the six months ended June
30, 2023, net cash used in operations was $(1,055,651), compared to $(411,988) for the six months ended June 30, 2022. This was primarily
due to the increase in platform expenses partially offset by a reduction in sales and marketing costs, and a reduction in headcount expenses.
Investing Activities
During the period
ended June 30, 2022, DLQ did use $50,000 to complete the acquisition of certain customer contractual agreements of Battle Bridge Labs,
LLC, including those of Section 2383 LLC, a Tulsa, Oklahoma based digital brand marketing agency. There were no investing activities
for the period ending June 30, 2023.
Financing Activities
During
the three months ended June 30, 2023, we generated $1,113,855 from financing activities, compared to $(333,436) of cash used in financing
activities for the six months ended June 30, 2022. This increase in financing was due to additional financing obtained from a related
party to support operating activities.
We estimate that
based on current plans and assumptions, that our available cash, credit line and the cash we generate from our core operations will generally
be sufficient to satisfy our capital expenditures under our present operating expectations, without further financing, for up to 12 months.
However, we shall continue to evaluate our capital expenditure needs based upon factors including our growth rate, the timing and extent
of spending to support development efforts, the expansion of our sales and marketing, the timing of new product introductions, and the
continuing market acceptance of our products and services.
To fund the expansion
of our operations and to provide working capital necessary for our long-term operations, management of DLQ will explore strategic
alliances with enterprise investors that have a specific investment focus on digital marketing, advertising technology and lead generation
companies. DLQ is already acquainted with investment groups that have portfolio companies which could form strategic investment/partnerships
with DLQ.
DLQ will explore
these opportunities after the Business Combination, however there can be no assurance that any of the anticipated relationships will be
available to us, or, if available, that would be able to raise additional capital on terms acceptable to us. If we cannot raise additional
funds when we need or want them, our operations and prospects could be negatively affected.
We shall continue to evaluate our capital
expenditure needs based upon factors including our growth rate, the timing and extent of spending to support development efforts, the
expansion of our sales and marketing, the timing of new product introductions, and the continuing market acceptance of our products and
services. If cash generated from operations is insufficient to satisfy our capital requirements, immediately after closing the Business
Combination, DLQ, Abri, and the Sponsor may enter into debt or equity financing for up to $30 million.
In addition,
we may have to sell additional equity or debt securities or obtain expanded credit facilities to fund our operating expenses, pay our
obligations, diversify our geographical reach, and grow our company. In the event such financing is needed in the future, there can be
no assurance that such financing will be available to us, or, if available, that it will be in amounts and on terms acceptable to us.
If we cannot raise additional funds when we need or want them, our operations and prospects could be negatively affected. However, if
cash flows from operations become insufficient to continue operations at the current level, and if no additional financing were obtained,
then management would restructure the Combined Company in a way to preserve its business while maintaining expenses within operating cash
flows.
Carve-Out Consolidated
Results of Operations for the fiscal years ended December 31, 2022 and 2021
Carve-Out Consolidated Results
of Operations
Results of Operations for
the years ended December 31, 2022 and 2021
The following
sets forth selected items from our carve-out consolidated statements of operations and the percentages that such items bear to net
sales for the years ended December 31, 2022 and 2021. The consolidated results include DLQ, Inc. and its two wholly owned subsidiaries,
Tamble, Inc. and Push Interactive, LLC. Tamble, Inc. is not an operating business. Its sole purpose is to hire independent contractors
for Logiq and DLQ’s marketing business.
| | |
For the years ended | |
| | |
December 31,
2022 | | |
December 31,
2021 | | |
Change | |
| Revenue | |
$ | 20,235,536 | | |
| 100.0 | % | |
$ | 22,792,189 | | |
| 100.0 | % | |
$ | (2,556,653 | ) | |
| (11.2 | )% |
| Platform operations | |
| 16,370,316 | | |
| 80.9 | | |
| 16,392,490 | | |
| 71.9 | | |
| (22,174 | ) | |
| (0.1 | ) |
| Depreciation and amortization | |
| 1,410,961 | | |
| 7.0 | | |
| 971,517 | | |
| 4.2 | | |
| 439,444 | | |
| 45.2 | |
| General and administrative | |
| 6,729,611 | | |
| 33.2 | | |
| 9,193,718 | | |
| 40.3 | | |
| (2,464,107 | ) | |
| (26.8 | ) |
| Sales and marketing | |
| 1,205,233 | | |
| 6.0 | | |
| 1,075,176 | | |
| 4.7 | | |
| 130,057 | | |
| 12.1 | |
| Technology and development | |
| — | | |
| 0.0 | | |
| 260,952 | | |
| 1.1 | | |
| (260,952 | ) | |
| (100.0 | ) |
| Total operating expenses | |
| 25,716,121 | | |
| 127.1 | | |
| 27,893,853 | | |
| 122.5 | | |
| (2,177,732 | ) | |
| (7.8 | ) |
| Loss from operations | |
| (5,480,585 | ) | |
| (27.1 | ) | |
| (5,101,664 | ) | |
| (22.3 | ) | |
| 378,921 | | |
| (7.4 | ) |
| Other (Expenses)/Income, net | |
| (84,732 | ) | |
| (0.4 | ) | |
| 62,653 | | |
| 0.3 | | |
| (147,385 | ) | |
| (235.2 | ) |
| Gain of Forgiveness from PPP Loan | |
| — | | |
| 0.0 | | |
| 503,700 | | |
| 2.2 | | |
| (503,700 | ) | |
| (100.0 | ) |
| Net Loss before income tax | |
| (5,565,317 | ) | |
| (27.5 | ) | |
| (4,535,311 | ) | |
| (19.8 | ) | |
| 1,030,006 | | |
| (22.7 | ) |
| Income tax expense | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | |
| Net Loss | |
$ | (5,565,317 | ) | |
| (27.5 | )% | |
$ | (4,535,311 | ) | |
| (19.8 | )% | |
$ | 1,030,006 | | |
| (22.7 | )% |
Revenue
Revenues were $20,235,536 and $22,792,189
for the twelve months ended December 31, 2022 and 2021, respectively. The decrease is primarily due to a decrease in the Lead
Generation Revenue from $20,862,271 for the year ended December 31, 2021 to $11,540,265 of the year ended December 31, 2022.
This loss was partially offset by the new Affiliate Management revenue of $6,441,775 for the year ended December 31, 2022.
Other Income/(Expenses)
Other expenses were $84,732 for the twelve
months ended December 31, 2022 which represented primarily the fees and expenses related to the receivable factoring. Other income
was $62,653 for the twelve months ended December 31, 2021. The income represents forgiveness of a PPP loan partially offset
by write-off activity.
Operating Expenses
Platform Operations
Platform Operations was $16,370,316 and
$16,392,490, essentially flat, for the twelve months ended December 31, 2022 and 2021, respectively. While revenue decreased,
the cost did not as the margin of the Affiliate Management was less than that of the Lead Generation revenue.
Sales and Marketing (S&M)
S&M expense was $1,205,233 and $1,075,176
for the twelve months ended December 31, 2022 and 2021, respectively. The marginal increase is mainly due to investor relations,
public relations and professional services related to continued attempts to list on a senior exchange in 2022.
General and Administrative (G&A)
General and administrative expenses were
$6,729,611 and $9,193,718 for the twelve months ended December 31, 2022 and 2021, respectively. The decrease is primarily due
to the reduction of stock compensation expense as there were no additional grants awarded and DLQ recorded a recovery of prior year expense
due to forfeitures in the year ended December 31, 2022.
Technology and Development
Technology and Development expenses were
$0 and $260,952 for the twelve months ended December 31, 2022 and 2021, respectively. Technology and development costs are expensed
as incurred and consist primarily of salaries and related expenses, consulting services and other direct expenses. There was no software
development performed in 2022.
Loss from operations
DLQ posted a loss from operations of $(5,480,585)
and $(5,101,664) for the twelve months ended December 31, 2022 and 2021, respectively. The increased loss was due to a decrease in
revenue and increase in amortization due to the acquisition of Battle Bridge partially offset by a decrease in G&A expenses for the
year ended December 31, 2022.
Net loss before income tax
DLQ posted a net loss before income tax
$(5,565,317) and $(4,535,311) for the twelve months ended December 31, 2022 and 2021, respectively.
The increased loss was due to a decrease
in revenue and increase in amortization due to the acquisition of Battle Bridge partially offset by a decrease in G&A expenses, combined
with the fact that there was no gain related to the forgiveness of the PPP loan reflected for the year ended December 31, 2022.
Consolidated income tax expense
No provision for corporate taxes is made
as DLQ incurred a loss and has unutilized loss carry forwards. The tax paid during the fiscal year is for Delaware franchise taxes for
the current and prior years.
Net loss
DLQ posted a consolidated net loss of
$(5,565,317) for the twelve months ended December 31, 2022 as compared to a net loss of $(4,535,311) for the year ended December 31,
2021. The increase in the loss is primarily due to a decrease in revenue partially offset by a decrease in G&A expenses, combined
with the fact that there was no gain related to the forgiveness of the PPP loan reflected for the year ended December 31, 2022.
Known Trends or Uncertainties
We have seen some consolidation in the
mobile applications industry during economic downturns. These consolidations have not had a negative effect on our total sales; however,
should consolidations and downsizing in the industry continue to occur, those events could adversely impact our revenues and earnings
going forward.
We believe that the need for improved
productivity in the research and development activities directed toward developing new and enhanced PaaS applications will continue to
result in SMBs utilizing our products and services. New product developments could result in increased revenues and earnings if they are
accepted by our markets; however, there can be no assurances that new products will result in significant improvements to revenues or
earnings. For competitive reasons, we do not disclose all of our new product development activities.
The potential for growth in new markets
is uncertain. We will continue to explore these opportunities until such time as we either generate sales or determine that resources
would be more efficiently used elsewhere.
Inflation
We have not been affected materially by
inflation during the periods presented, and no material effect is expected in the near future.
Contractual Obligations and Commitments
We have no material contractual obligations
as of December 31, 2022.
Critical Accounting Policies and Estimates
Our critical accounting policies and estimates
are included in Note 2 — “Summary of Significant Accounting Policies” of Notes to Consolidated Financial
Statements included herein.
Recently Issued or Newly Adopted Accounting Standards
Our recently issued or newly adopted accounting
standards are included in Note 2 — “Summary of Significant Accounting Policies” of the Notes to Consolidated
Financial Statements included herein.
Off-Balance Sheet Arrangements
As of December 31, 2022, we did not
have any relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance
or special purpose entities, which would have been established for the purpose of facilitating off-balance sheet arrangements or
other contractually narrow or limited purposes. As such, we are not materially exposed to any financing, liquidity, market, or credit
risk that could arise if we had engaged in such relationships.
We do not have relationships or transactions
with persons or entities that derive benefits from their non-independent relationship with us or our related parties.
| | |
For the Year Ended
December 31, | |
| Cash flows: | |
2022 | | |
2021 | |
| Net cash used in operating activities | |
$ | (2,586,812 | ) | |
$ | (1,314,376 | ) |
| Net cash used in investment activities | |
$ | (50,000 | ) | |
$ | — | |
| Net cash provided by financing activities | |
$ | 2,227,734 | | |
$ | 1,975,000 | |
Operating Activities
During the year ended December 31,
2022, cash used in operations was $(2,586,812), compared to $(1,314,376) for the year ended December 31, 2021. This was primarily
due to a decrease in sales partially offset by a reduction in cash operating expenses. The decrease in sales was in the Lead Generation
category partially offset by the increase in the new Affiliate Management business. The new Affiliate Management business generated approximately
$6,442,000 in 2022. The decrease in the Lead Generation business from approximately $20,862,000 in 2021 to approximately $11,540,000 in
2022 was largely driven by a reduction of working capital available that reduced the ability to place ads on behalf of clients. While
DLQ was able to reduce total operating expenses by approximately $2,200,000, it was not enough to offset the reduction in sales.
Investing Activities
During the year
ended December 31, 2022, we used $50,000 in DLQ investment activities, as compared to not using any cash for investing activities
during the year ended December 31, 2021. DLQ used the funds to complete the acquisition of certain customer contractual agreements
of Battle Bridge Labs, LLC, including those of Section 2383 LLC, a Tulsa, Oklahoma based digital brand marketing agency.
Financing Activities
During the year
ended December 31, 2022, we generated cash of $2,227,734 from financing activities, compared to $1,975,000 of cash generated for
the year ended December 31, 2021. This increase in financing was due to additional financing obtained by entering a factoring agreement
for our accounts receivable to support growth.
We estimate that
based on current plans and assumptions, that our available cash, credit line and the cash we generate from our core operations will generally
be sufficient to satisfy our capital expenditures under our present operating expectations, without further financing, for up to 12 months.
However, we shall continue to evaluate our capital expenditure needs based upon factors including our growth rate, the timing and extent
of spending to support development efforts, the expansion of our sales and marketing, the timing of new product introductions, and the
continuing market acceptance of our products and services.
To fund the expansion
of our operations and to provide working capital necessary for our long-term operations, management of DLQ will explore strategic
alliances with enterprise investors that have a specific investment focus on digital marketing, advertising technology and lead generation
companies. DLQ is already acquainted with investment groups that have portfolio companies which could form strategic investment/partnerships
with DLQ.
DLQ will explore
these opportunities after the Business Combination, however there can be no assurance that any of the anticipated relationships will be
available to us, or, if available, that would be able to raise additional capital on terms acceptable to us. If we cannot raise additional
funds when we need or want them, our operations and prospects could be negatively affected.
DLQ shall continue to evaluate our capital
expenditure needs based upon factors including our growth rate, the timing and extent of spending to support development efforts, the
expansion of our sales and marketing, the timing of new product introductions, and the continuing market acceptance of our products and
services. If cash generated from operations is insufficient to satisfy our capital requirements, immediately after closing the Business
Combination, DLQ, Abri, and the Sponsor may enter into an debt or equity financing arrangement for up to $30 million.
In addition,
we may have to sell additional equity or debt securities or obtain expanded credit facilities to fund our operating expenses, pay our
obligations, diversify our geographical reach, and grow our company. In the event such financing is needed in the future, there can be
no assurance that such financing will be available to us, or, if available, that it will be in amounts and on terms acceptable to us.
If we cannot raise additional funds when we need or want them, our operations and prospects could be negatively affected. However, if
cash flows from operations become insufficient to continue operations at the current level, and if no additional financing were obtained,
then management would restructure the Combined Company in a way to preserve its business while maintaining expenses within operating cash
flows.
SELECTED UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL
INFORMATION
The following summary Unaudited Pro Forma
Condensed Combined Balance Sheet as of June 30, 2023, and the summary Unaudited Pro Forma Condensed Combined Statement of Operations
for the three-months ended June 30, 2023 and for the year ended December 31, 2022 presents the combination of the financial
information of DLQ and Abri after giving effect to the Business Combination and related adjustments described in the accompanying notes
to the Unaudited Pro Forma Condensed Combined Financial Information, and have been prepared in accordance with Article 11 of Regulation S-X.
The summary Unaudited Pro Forma Condensed
Combined Balance Sheet as of June 30, 2023 combines the historical balance sheet of DLQ and the historical balance sheet of Abri
on a pro forma basis as if the Business Combination, summarized below, had been consummated on June 30, 2023. The summary Unaudited
Pro Forma Condensed Combined Statement Of Operations for the three-months ended June 30, 2023 and the year ended December 31,
2022 combine the historical statement of operations of DLQ and Abri for such period on a pro forma basis as if the transaction, summarized
below, had been consummated on January 1, 2022, the beginning of the earliest period presented:
| · | The merger of DLQ and Abri, with DLQ surviving as the
wholly-owned subsidiary of Abri after the merger, and Abri changing its name to Collective Audience, Inc.; and |
| · | Upon the exchange, each outstanding share of DLQ Common
Stock will be automatically cancelled, extinguished and converted into a number of shares of Collective Audience, Inc. Common Stock, based
on DLQ’s Equity Value and based on a conversion rate of 4,998 at June 30, 2023 and December 31, 2022, respectively. |
The summary unaudited
pro forma condensed combined financial information is based on and should be read in conjunction with the audited historical financial
statements of each of DLQ and Abri and the notes thereto, as well as the disclosures contained in the sections titled “Management’s
Discussion and Analysis of Financial Condition and Results of Operations of DLQ” and “Management’s Discussion
and Analysis of Financial Condition and Results of Operations of Abri.”
The following
tables present selected pro forma information after giving effect to the Business Combination and Related Transactions presented under
the following scenarios:
| · | Assuming No Additional Redemption: This presentation
assumes that no additional public stockholders of Abri exercise redemption rights with respect to their public shares for a pro rata share
of the funds in the Trust Account. |
| · | Assuming Maximum Redemption: This presentation
assumes that all 682,148 remaining public shares currently held by Abri public stockholders exercise their redemption rights in exchange
for their pro rata share of the $7,595,569 currently held in the trust account. |
The figures in
the following tables are presented only as illustrative examples and are based on the scenarios described above, which may be different
from the actual amount of redemptions in connection with the Business Combination.
Summary Unaudited Pro Forma
Condensed Combined Balance Sheet as of June 30, 2023
| | |
Pro Forma
Combined
(Assuming No
Additional
Redemption) | | |
Pro Forma
Combined
(Assuming
Maximum
Redemption) | |
| Summary Unaudited Pro Forma Condensed Combined | |
| | | |
| | |
| Balance Sheet Data as of June 30, 2023 | |
| | | |
| | |
| Total assets | |
$ | 22,930,180 | | |
$ | 18,568,895 | |
| Total liabilities | |
$ | 19,549,001 | | |
$ | 22,783,285 | |
| Total stockholders’ equity (deficit) | |
$ | 3,381,179 | | |
$ | (4,214,390 | ) |
Summary Unaudited Pro Forma Condensed Combined Statement
of Operations
For the Six months Ended June 30, 2023
| | |
Pro Forma
Combined
(Assuming No
Additional
Redemption) | | |
Pro Forma
Combined
(Assuming
Maximum
Redemption) | |
| Summary Unaudited Pro Forma Condensed Combined | |
| | | |
| | |
| Statement of Operations Data | |
| | | |
| | |
| Six months Ended June 30, 2023 | |
| | | |
| | |
| Revenue | |
$ | 8,398,088 | | |
$ | 8,398,088 | |
| Net income (loss) | |
$ | (3,640,056 | ) | |
$ | (3,640,056 | ) |
| Net loss per share – basic | |
$ | (0.26 | ) | |
$ | (0.28 | ) |
| Net loss per share – diluted | |
$ | (0.26 | ) | |
$ | (0.28 | ) |
| Weighted-average shares outstanding – basic | |
| 13,840,226 | | |
| 13,158,078 | |
| Weighted-average shares outstanding – diluted | |
| 13,840,226 | | |
| 13,158,078 | |
| | |
Pro Forma
Combined
(Assuming No
Additional
Redemption) | | |
Pro Forma
Combined
(Assuming
Maximum
Redemption) | |
| Summary Unaudited Pro Forma Condensed Combined | |
| | | |
| | |
| Statement of Operations Data | |
| | | |
| | |
| Year Ended December 31, 2022 | |
| | | |
| | |
| Revenue | |
$ | 20,235,536 | | |
$ | 20,235,536 | |
| Net income (loss) | |
$ | (11,278,330 | ) | |
$ | (11,278,330 | ) |
| Net loss per share – basic | |
$ | (0.81 | ) | |
$ | (0.86 | ) |
| Net loss per share – diluted | |
$ | (0.81 | ) | |
$ | (0.86 | ) |
| Weighted-average shares outstanding – basic | |
| 13,840,226 | | |
| 13,158,078 | |
| Weighted-average shares outstanding – diluted | |
| 13,840,226 | | |
| 13,158,078 | |
If the actual facts are different than
these assumptions, then the amounts and shares outstanding in the unaudited pro forma condensed combined financial information will be
different and those changes could be material.
COMPARATIVE HISTORICAL
AND UNAUDITED PRO FORMA
COMBINED PER SHARE FINANCIAL INFORMATION
he following
tables set forth:
| · | historical per share information of Abri for the three-months ended
June 30, 2023 and year ended December 31, 2022; |
| · | historical per share information of DLQ for the three-months ended
June 30, 2023 and the year ended December 31, 2022 and |
| · | unaudited pro forma per share information of the Combined
Company for the three-months ended June 30, 2023 and the year ended December 31, 2022, after giving effect to the Business Combination,
as follows: |
| · | Assuming No Additional Redemption: This presentation
assumes that no public stockholders of Abri exercise redemption rights with respect to their public shares for a pro rata share of the
funds in the trust account. |
| · | Assuming Maximum Redemption: This presentation
assumes that all 682,148 remaining public shares currently held by Abri public stockholders exercise their redemption rights in exchange
for their pro rata share of the $7,595,569 currently held in the trust account. |
The following
tables should be read in conjunction with the summary historical financial information included elsewhere in this proxy statement, and
the historical financial statements of Abri and DLQ and the related notes thereto that are included elsewhere in this proxy statement.
The unaudited Abri and DLQ pro forma combined per share information is derived from, and should be read in conjunction with, the unaudited
pro forma condensed combined financial statements and the related notes thereto included elsewhere in this proxy statement.
The unaudited
pro forma combined net income per share information below does not purport to represent the actual results of operations that would have
occurred had the companies been combined during the periods presented, nor does it purport to represent the actual results of operations
for any future date or period. The unaudited pro forma combined book value per share information below does not purport to represent what
the value of Abri and DLQ would have been had the companies been combined during the periods presented.
| | |
| | |
Combined Pro Forma | | |
Collective Audience, Inc.
Equivalent Per Share
Pro Forma(2) | |
| | |
DLQ
(Historical) | | |
Abri
(Historical) | | |
Pro Forma
Combined
(Assuming No
Additional
Redemption) | | |
Pro Forma
Combined
(Assuming
Maximum
Redemption) | | |
Pro Forma
Combined
(Assuming No
Additional
Redemption) | | |
Pro Forma
Combined
(Assuming
Maximum
Redemption) | |
| As of and for the six months ended June 30, 2023 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Book Value per share(1) | |
$ | 2,191.08 | | |
$ | (5.82 | ) | |
$ | 0.24 | | |
$ | (0.32 | ) | |
$ | 1,199.47 | | |
$ | (1,599.30 | ) |
| Weighted average redeemable common shares outstanding – basic and diluted | |
| 2,000 | | |
| 1,252,372 | | |
| 13,840,226 | | |
| 13,158,078 | | |
| 11,400,000 | | |
| 11,400,000 | |
| Weighted average non-redeemable common shares outstanding – basic and diluted | |
| 2,000 | | |
| 1,728,078 | | |
| 13,840,226 | | |
| 13,158,078 | | |
| 11,400,000 | | |
| 11,400,000 | |
| Net loss per share of redeemable common stock – basic and diluted | |
$ | (1,294.76 | ) | |
$ | (0.00 | ) | |
$ | (0.26 | ) | |
$ | (0.28 | ) | |
$ | (1,314.45 | ) | |
$ | (1,382.60 | ) |
| Net loss per share of non-redeemable common stock – basic and diluted | |
$ | (1,294.76 | ) | |
$ | (0.49 | ) | |
$ | (0.26 | ) | |
$ | (0.28 | ) | |
$ | (1,314.45 | ) | |
$ | (1,382.60 | ) |
| | |
| | |
| | |
Combined Pro Forma | | |
| | |
DLQ, Inc.
Equivalent Per Share
Pro Forma(2) | | |
| |
| | |
DLQ
(Historical) | | |
Abri
(Historical) | | |
Pro Forma
Combined
(Assuming No
Additional
Redemption) | | |
Pro Forma
Combined
(Assuming
Maximum
Redemption) | | |
Pro Forma
Combined
(Assuming No
Additional
Redemption) | | |
Pro Forma
Combined
(Assuming
Maximum
Redemption) | |
| As of and for the Year ended December 31, 2022 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Book Value per share(1) | |
$ | 3,152.97 | | |
$ | (1.07 | ) | |
$ | 0.75 | | |
$ | 0.21 | | |
$ | 3,748.36 | | |
$ | 1,049.54 | |
| Weighted average redeemable common shares outstanding – basic and diluted | |
| 2,000 | | |
| 5,463,799 | | |
| 13,840,226 | | |
| 13,158,078 | | |
| 11,400,000 | | |
| 11,400,000 | |
| Weighted average non-redeemable common shares outstanding – basic and diluted | |
| 2,000 | | |
| 1,728,078 | | |
| 13,840,226 | | |
| 13,158,078 | | |
| 11,400,000 | | |
| 11,400,000 | |
| Net loss per share of redeemable common stock – basic and diluted | |
$ | (2,782.66 | ) | |
$ | (0.06 | ) | |
$ | (0.81 | ) | |
$ | (0.86 | ) | |
$ | (4,072.69 | ) | |
$ | (4,283.83 | ) |
| Net loss per share of non-redeemable common stock – basic and diluted | |
$ | (2,782.66 | ) | |
$ | (1.25 | ) | |
$ | (0.81 | ) | |
$ | (0.86 | ) | |
$ | (4,072.69 | ) | |
$ | (4,283.83 | ) |
| (1) | Book value per share = (Total equity)/common shares outstanding |
| (2) | The equivalent pro forma basic and diluted per share data for DLQ. Equivalent per share pro forma
is calculated based on expected exchange ratio of 4,998. |
UNAUDITED PRO FORMA COMBINED CONDENSED FINANCIAL INFORMATION
Basis of Presentation and Business Combination
The following
unaudited pro forma combined condensed consolidated financial statements are based on the separate historical financial statements of
DLQ and Abri and give effect to the Merger, including pro forma assumptions and adjustments related to the Merger, as described in the
accompanying notes to the unaudited pro forma combined condensed financial statements. The Unaudited Pro Forma Condensed Combined Balance
Sheet as of March 31, 2023, is presented as if the Merger had occurred on January 1, 2022. The Unaudited Pro Forma Condensed
Combined Statement of Operations for the year ended December 31, 2022 gives effect to the Merger, as if it had been completed on
January 1, 2022. The historical financial information has been adjusted on a pro forma basis to reflect factually supportable items
that are directly attributable to the Merger and, with respect to the Condensed Combined Statement of Operations only, expected to have
a continuing impact on consolidated results of operations.
On September 9,
2022, Abri entered into a Merger Agreement, by and among, Abri and DLQ, pursuant to which Abri will acquire one hundred percent (100%)
of the outstanding equity securities of DLQ. The Merger Agreement provides that Abri has agreed to acquire all of the outstanding
equity interests of DLQ for an aggregate of 11,400,000 shares of Abri common stock, par value $0.0001 par value.
DLQ Management Earnout Agreement
In connection with the execution of the
Merger Agreement, Abri and the Sponsor will enter into a Management Earnout Agreement, pursuant to which certain members of the Management
team of DLQ specified on schedule A to the Management Earnout Agreement will have the contingent right to earn the Management Earnout
Shares (as defined in the Management Earnout Agreement). The Management Earnout Shares consist of 2,000,000 shares of Abri Common Stock.
The release of the Management Earnout Shares shall occur as follows:
| |
· |
500,000 Management Earnout Shares will be earned and released upon satisfaction of the First Milestone Event (as defined in the Management Earnout Agreement); |
| |
· |
650,000 Management Earnout Shares will be earned and released upon satisfaction of the Second Milestone Event (as defined in the Management Earnout Agreement); and |
| |
· |
850,000 Management Earnout Shares will be earned and released upon satisfaction of the Third Milestone Event (as defined in the Management Earnout Agreement). |
Sponsor Earnout Agreement
In connection
with the execution of the Merger Agreement, Abri and the Sponsor will enter into a Sponsor Earnout Agreement, pursuant to which the Sponsor
will have the contingent right to earn the Sponsor Earnout Shares (as defined in the Sponsor Earnout Agreement). The Sponsor Earnout Shares
consist of 1,000,000 shares of Abri Common Stock. The release of the Sponsor Earnout Shares shall occur as follows:
| |
· |
250,000 Sponsor Earnout Shares will be earned and released upon satisfaction of the First Milestone Event (as defined in the Sponsor Earnout Agreement); |
| |
· |
350,000 Sponsor Earnout Shares will be earned and released upon satisfaction of the Second Milestone Event (as defined in the Sponsor Earnout Agreement); and |
| |
· |
400,000 Sponsor Earnout Shares will be earned and released upon satisfaction of the Third Milestone Event (as defined in the Sponsor Earnout Agreement). |
Accounting Treatment for Earnout
Abri and DLQ
have analyzed the accounting treatment for the earnout arrangement and has concluded that the Earnout Shares should not be classified
as a liability under ASC 480, Distinguishing Liabilities from Equity (“ASC 480”). The Earnout Shares were evaluation next,
which met the definition of a derivative instrument pursuant to ASC 815, Derivatives and Hedging, (“ASC 815”),
qualifies for the scope exception in ASC 815-10-15-74(a), which states that a reporting entity shall not consider contracts that are both
(a) indexed to an entity’s own stock and (b) classified in stockholders’ equity in its statement of financial position to
be derivative instruments. This analysis was performed in accordance with the guidance in ASC 815-40. In order to conclude that the Earnout
Shares meet this scope exception and whether they should be accounted for as equity under ASC 815-40, it was evaluated whether the Earnout
Shares meet both of these requirements. The merger agreement contains a change in control provision that could impact the settlement of
the Earnout Shares and therefore results in the Earnout Shares being classified as a liability pursuant to ASC 815. The Company next considered
the equity classification conditions in ASC 815-40-25 and concluded that they did not meet such classification because the merger
agreement contains a change in control provision that could impact the settlement of the Earnout Shares and, therefore, results in the
Earnout Shares being classified as a liability pursuant to ASC 815. Therefore, the Earnout Share arrangement is appropriately classified
as liability. As the merger is accounted for as a reverse recapitalization, the fair value of the Earnout Share arrangement as of the
merger date will be accounted for as a liability transaction as of the closing date of the Merger and remeasured to fair value at each
balance sheet date in future reporting periods with changes in fair value recorded in the New DLQ consolidated statement of operations.
As of the date of the filing, because such fair value assessment has not been completed, the Company is not able to quantify the magnitude
of any potential adjustments to the measurements depicted.
The Merger will
be accounted for as a reverse recapitalization because DLQ has been determined to be the accounting acquirer under Financial Accounting
Standards Board’s Accounting Standards Codification Topic 805, Business Combinations (“ASC 805”). Under this method
of accounting, Abri will be treated as the “acquired” company for financial reporting purposes. Accordingly, the consolidated
assets, liabilities and results of operations of DLQ will become the historical financial statements of Collective Audience, Inc., and
Abri’s assets, liabilities and results of operations will be consolidated with DLQ beginning on the acquisition date. For accounting
purposes, the financial statements of Collective Audience, Inc. will represent a continuation of the financial statements of DLQ with
the Transaction being treated as the equivalent of DLQ issuing stock for the net assets of Abri, accompanied by a recapitalization. Operations
prior to the Merger will be presented as those of DLQ in future reports of DataLogiq, Inc. This determination is primarily based on the
evaluation of the following facts and circumstances taken into consideration:
| · | Pre-business combination stockholders of DLQ will
own a relatively larger portion in the combined company compared to the ownership to be held by the pre-business combination stockholders
of Abri; |
| · | DLQ has the right to appoint a majority of DLQ Incorporated
members; |
| · | Senior management of DLQ will comprise the senior management
of the combined company; and |
| · | The operations of DLQ prior to the transaction will
comprise the only ongoing operations of the combined company. |
Under the reverse
recapitalization model, the business combination will be treated as DLQ issuing equity for the net assets of Abri, with no goodwill or
intangible assets are recorded.
The Unaudited
Pro Forma Condensed Combined Statement of Operations does not include the effects of the costs associated with any integration or restructuring
activities resulting from the Merger, as they are nonrecurring in nature. However, the Unaudited Pro Forma Condensed Consolidated Balance
Sheet includes a pro forma adjustment to reduce cash and stockholders’ equity to reflect the payment of certain anticipated Merger
costs.
The following
unaudited pro forma condensed combined financial information presents the combination of the financial information of Abri and DLQ, adjusted
to give effect to the Merger and other events contemplated by the Merger Agreement. The following unaudited pro forma condensed combined
financial information has been prepared in accordance with Article 11 of Regulation S-X as amended by the final rule, Release 33-10786 “Amendments
to Financial Disclosures about Acquired and Disposed Businesses.”
The Unaudited Pro Forma Condensed Combined
Balance Sheet as of June 30, 2023 combines the adjusted balance sheet of Abri with the historical Condensed Consolidated Balance
Sheet of DLQ on a pro forma basis as if the Merger and the other events contemplated by the Merger Agreement, summarized below, had been
consummated on June 30, 2023.
The Unaudited Pro Forma Condensed Combined
Statement of Operations for the six months ended June 30, 2023 and the year ended December 31, 2022 combines the historical
unaudited statements of operations of Abri for the six months ended June 30, 2023 and the year ended December 31, 2022
with the historical Unaudited Condensed Consolidated Statement of Operations of DLQ for the same respective periods, giving effect to
the transaction as if the Merger and other events contemplated by the Merger Agreement had been consummated on January 1, 2022.
The unaudited
pro forma condensed combined financial information was derived from and should be read in conjunction with the following historical financial
statements and the accompanying notes, which are included elsewhere in this proxy statement:
| · | the historical audited financial statements of Abri
as of and for the year ended December 31, 2022; |
| · | the historical audited financial statements of DLQ as
of and for year ended December 31, 2022; |
| · | the historical unaudited financial statements of Abri
as of and for the three months ended June 30, 2023; |
| · | the historical unaudited financial statements of DLQ
as of and for the three months ended June 30, 2023; and |
| · | other information relating to Abri and DLQ included
in this proxy statement, including the Merger Agreement and the description of certain terms thereof set forth thereof and the financial
and operational condition of Abri and DLQ (see “Proposal No. 1 — The Merger Agreement,” “Management’s
Discussion and Analysis of Financial Condition and Results of Operations of Abri,” and “Management’s
Discussion and Analysis of Financial Condition and Results of Operations of DLQ”) |
Management has
made significant estimates and assumptions in its determination of the pro forma adjustments. As the unaudited pro forma condensed combined
financial information has been prepared based on these preliminary estimates, the final amounts recorded may differ materially from the
information presented.
The pro forma
adjustments reflecting the consummation of the Business Combination are based on certain currently available information and certain assumptions
and methodologies that Abri believes are reasonable under the circumstances. The unaudited condensed combined pro forma adjustments, which
are described in the accompanying notes, may be revised as additional information becomes available and is evaluated. Therefore, it is
likely that the actual adjustments will differ from the pro forma adjustments, and it is possible the difference may be material. Abri
believes that its assumptions and methodologies provide a reasonable basis for presenting all the significant effects of the Business
Combination based on information available to management at this time and that the pro forma adjustments give appropriate effect to those
assumptions and are properly applied in the unaudited pro forma condensed combined financial information.
The unaudited
pro forma condensed combined financial information is not necessarily indicative of what the actual results of operations and financial
position would have been had the Business Combination taken place on the dates indicated, nor are they indicative of the future consolidated
results of operations or financial position of the Combined Company. The unaudited pro forma condensed combined financial information
should be read in conjunction with the historical financial statements and notes thereto of Abri and DLQ.
The unaudited
pro forma condensed combined information contained herein assumes that Abri’s stockholders approve the Business Combination. Abri’s
remaining public stockholders may elect to redeem their public shares for cash even if they approve the Business Combination. Abri cannot
predict how many of its public stockholders will exercise their right to have their shares redeemed for cash; however, we are assuming
maximum redemption of the remaining 1,252,372 shares subject to redemption in the preparation of the pro forma condensed combined
financial statements.
As a result of
the Business Combination, Abri will acquire DLQ, subject to the terms of the Merger Agreement, holders of DLQ Common Stock
immediately prior to the effective time of the Merger will be entitled to receive 11,400,000 fully paid and non-assessable shares
of Abri common stock for which the allocation of such shares is to be allocated to the holders of DLQ as determined by DLQ.
The following
table sets forth, on a pro forma unaudited as adjusted basis, as of June 30, 2023, giving effect to the Merger and assuming maximum redemption:
| | |
Shares Outstanding | |
| | |
Number | | |
Percent | |
| DLQ parent, parent stockholders and investors | |
| 11,400,000 | | |
| 86.6 | % |
| Abri stockholders | |
| 1,728,078 | | |
| 13.1 | % |
| Representative stockholders | |
| 30,000 | | |
| 0.2 | % |
| Totals | |
| 13,158,078 | | |
| 100.0 | % |
DLQ, Inc. and Abri SPAC I, Inc.
Unaudited Pro Forma Condensed Combined Balance Sheet
(In thousands), except per share amounts
As of June 30, 2023
| | |
As of
June 30,
2023 | | |
| | |
| |
As of
June 30,
2023 | | |
| | |
| |
As of
June 30,
2023 | |
| | |
DLQ
(Historical) | | |
Abri
(Historical) | | |
Transaction
Accounting
Adjustments
(Assuming
No
Additional
Redemption) | | |
| |
Pro Forma
Combined
(Assuming No
Additional
Redemption) | | |
Transaction
Accounting
Adjustments
(Assuming
Maximum
Redemption) | | |
| |
Pro Forma
Combined
(Assuming
Maximum
Redemption) | |
| | |
| | |
| | |
| | |
| |
| | |
| | |
| |
| |
| ASSETS | |
| | | |
| | | |
| | | |
| |
| | | |
| | | |
| |
| | |
| Current assets: | |
| | | |
| | | |
| | | |
| |
| | | |
| | | |
| |
| | |
| Cash and cash equivalents | |
$ | 475 | | |
$ | 148 | | |
$ | 7,596 | | |
A | |
$ | 6,107 | | |
| (7,596 | ) | |
L | |
$ | 1,745 | |
| | |
| | | |
| | | |
| (2,378 | ) | |
B | |
| | | |
| 3,234 | | |
M | |
| | |
| | |
| | | |
| | | |
| (1,500 | ) | |
C | |
| | | |
| | | |
| |
| | |
| | |
| | | |
| | | |
| (3,234 | ) | |
H | |
| | | |
| | | |
| |
| | |
| | |
| | | |
| | | |
| 5,000 | | |
K | |
| | | |
| | | |
| |
| | |
| Accounts receivable, net | |
| 837 | | |
| — | | |
| — | | |
| |
| 837 | | |
| — | | |
| |
| 837 | |
| Other current assets | |
| 32 | | |
| 117 | | |
| — | | |
| |
| 149 | | |
| — | | |
| |
| 149 | |
| Total current assets | |
| 1,344 | | |
| 265 | | |
| 5,484 | | |
| |
| 7,093 | | |
| (4,362 | ) | |
| |
| 2,731 | |
| Non-current assets: | |
| | | |
| | | |
| | | |
| |
| | | |
| | | |
| |
| | |
| Marketable securities held in trust account | |
| — | | |
| 13,651 | | |
| (7,596 | ) | |
A | |
| — | | |
| — | | |
| |
| — | |
| | |
| | | |
| | | |
| (6,055 | ) | |
J | |
| | | |
| | | |
| |
| | |
| Related party receivable | |
| 3,784 | | |
| — | | |
| — | | |
| |
| 3,784 | | |
| — | | |
| |
| 3,784 | |
| Intangible assets, net | |
| 6,000 | | |
| — | | |
| — | | |
| |
| 6,000 | | |
| — | | |
| |
| 6,000 | |
| Property and equipment, net | |
| 63 | | |
| — | | |
| — | | |
| |
| 63 | | |
| — | | |
| |
| 63 | |
| Goodwill | |
| 5,991 | | |
| — | | |
| — | | |
| |
| 5,991 | | |
| — | | |
| |
| 5,991 | |
| Total non-current assets | |
| 15,838 | | |
| 13,651 | | |
| (13,651 | ) | |
| |
| 15,838 | | |
| — | | |
| |
| 15,838 | |
| TOTAL ASSETS | |
$ | 17,182 | | |
$ | 13,916 | | |
$ | (8,167 | ) | |
| |
$ | 22,931 | | |
$ | (4,362 | ) | |
| |
$ | 18,569 | |
| |
| | | |
| | | |
| | | |
| |
| | | |
| | | |
| |
| | |
| LIABILITIES, TEMPORARY
EQUITY AND STOCKHOLDERS’ EQUITY | |
| | | |
| | | |
| | | |
| |
| | | |
| | | |
| |
| | |
| Accounts payable | |
$ | 1,941 | | |
$ | 433 | | |
| — | | |
| |
$ | 2,374 | | |
| — | | |
| |
$ | 2,374 | |
| Accrued expenses | |
| 1,921 | | |
| — | | |
| — | | |
| |
| 1,921 | | |
| — | | |
| |
| 1,921 | |
| Accrued legal fees | |
| — | | |
| 2,576 | | |
| — | | |
| |
| 2,576 | | |
| — | | |
| |
| 2,576 | |
| Total current liabilities | |
| 3,862 | | |
| 3,009 | | |
| — | | |
| |
| 6,871 | | |
| — | | |
| |
| 6,871 | |
| Non-current liabilities: | |
| | | |
| | | |
| | | |
| |
| | | |
| | | |
| |
| | |
| Related party payable | |
| 8,666 | | |
| — | | |
| — | | |
| |
| 8,666 | | |
| — | | |
| |
| 8,666 | |
| Convertible promissory notes, related party | |
| — | | |
| 1,650 | | |
| (1,650 | ) | |
H | |
| — | | |
| 1,650 | | |
M | |
| 1,650 | |
| Note payable | |
| 271 | | |
| — | | |
| — | | |
| |
| 271 | | |
| | | |
| |
| 271 | |
| Promissory note, related party | |
| — | | |
| 1,584 | | |
| (1,584 | ) | |
H | |
| — | | |
| 1,584 | | |
M | |
| 1,584 | |
| Warrant liability | |
| — | | |
| 10 | | |
| (10 | ) | |
G | |
| — | | |
| — | | |
| |
| — | |
| Deferred underwriting commissions | |
| — | | |
| 1,500 | | |
| (1,500 | ) | |
C | |
| — | | |
| — | | |
| |
| — | |
| Warrant revenue side sharing liability | |
| — | | |
| — | | |
| 3,740 | | |
I | |
| 3,740 | | |
| — | | |
| |
| 3,740 | |
| Total non-current liabilities | |
| 8,937 | | |
| 4,744 | | |
| (1,004 | ) | |
| |
| 12,677 | | |
| 3,234 | | |
| |
| 15,911 | |
| Total liabilities | |
| 12,799 | | |
| 7,753 | | |
| (1,004 | ) | |
| |
| 19,548 | | |
| 3,234 | | |
| |
| 22,782 | |
| | |
| | | |
| | | |
| | | |
| |
| | | |
| | | |
| |
| | |
| COMMITMENTS AND CONTINGENCIES | |
| | | |
| | | |
| | | |
| |
| | | |
| | | |
| |
| | |
| Temporary equity: | |
| | | |
| | | |
| | | |
| |
| | | |
| | | |
| |
| | |
| Common stock subject to possible redemption | |
| — | | |
| 13,451 | | |
| (6,055 | ) | |
J | |
| | | |
| — | | |
| |
| — | |
| | |
| | | |
| | | |
| (7,396 | ) | |
D | |
| | | |
| | | |
| |
| | |
| | |
| | | |
| | | |
| | | |
| |
| | | |
| | | |
| |
| | |
| Stockholders’ equity (deficit): | |
| | | |
| | | |
| | | |
| |
| | | |
| | | |
| |
| | |
| Common stock | |
| — | | |
| — | | |
| 1 | | |
F | |
| 2 | | |
| — | | |
L | |
| 2 | |
| | |
| | | |
| | | |
| 1 | | |
D | |
| | | |
| | | |
| |
| | |
| Additional paid-in capital | |
| 21,013 | | |
| — | | |
| 7,395 | | |
D | |
| 20,011 | | |
| (7,596 | ) | |
L | |
| 12,415 | |
| | |
| | | |
| | | |
| (7,289 | ) | |
E | |
| | | |
| | | |
| |
| | |
| | |
| | | |
| | | |
| (1 | ) | |
F | |
| | | |
| | | |
| |
| | |
| | |
| | | |
| | | |
| 10 | | |
G | |
| | | |
| | | |
| |
| | |
| | |
| | | |
| | | |
| (2,378 | ) | |
B | |
| | | |
| | | |
| |
| | |
| | |
| | | |
| | | |
| (3,740 | ) | |
I | |
| | | |
| | | |
| |
| | |
| | |
| | | |
| | | |
| 5,000 | | |
K | |
| | | |
| | | |
| |
| | |
| Accumulated deficit | |
| (16,630 | ) | |
| (7,288 | ) | |
| 7,288 | | |
E | |
| (16,630 | ) | |
| — | | |
| |
| (16,630 | ) |
| Total stockholders’ equity (deficit) | |
| 4,383 | | |
| (7,288 | ) | |
| 6,288 | | |
| |
| 3,383 | | |
| (7,596 | ) | |
| |
| (4,213 | ) |
| TOTAL LIABILITIES, TEMPORARY EQUITY AND STOCKHOLDERS’ EQUITY (DEFICIT) | |
$ | 17,182 | | |
$ | 13,916 | | |
$ | (8,168 | ) | |
| |
$ | 22,930 | | |
$ | (4,362 | ) | |
| |
$ | 18,569 | |
Adjustments to Unaudited Pro Forma Condensed Combined
Balance Sheet
The pro forma adjustments included in
the Unaudited Pro Forma Condensed Combined Balance Sheet as of June 30, 2023, are as follows:
| (A) | Reflects the reclassification of cash and securities to cash under the no redemption scenario. |
| (B) | Represents preliminary estimated direct and incremental transaction costs to be incurred. These costs
are accounted for a reduction in the combined cash account with a corresponding reduction in additional paid-in capital consistent with
the treatment described in SEC Staff Accounting Bulletin Topic 5.A. These transaction costs will not recur in the Company’s
income beyond 12 months after the transaction. |
| (C) | Reflects the settlement of the deferred underwriting fee. |
| (D) | Reflects the reclassification of common stock subject to possible redemption to permanent equity. |
| (E) | Represents recapitalization of Abri’s historical accumulated deficit. |
| (F) | Represents recapitalization of historical amounts. |
| (G) | Represents the reclassification of the Abri pre-merger private warrant liability of 10,311 to equity,
based on the exercise of the Private Warrants assuming their full exercise upon a Business Combination, and the conversion of the convertible
debt into equity since the right to exercise the Private Warrants and the conversion of the convertible debt occur at the time of the
Business Combination. |
| (H) | Represents the settlement of the Abri convertible note, related party, in the amount of $1,584,284 and
promissory note, related party, in the amount of $1,650,000, for a total of $3,234,284 upon Merger. |
| (I) | Represents recognition of the fair value of the Warrant Revenue Side Sharing Agreement as a liability.
Per the agreement, Abri will split the proceeds of any warrant cash exercises received at any time, by delivering to the Sponsor 20% of
the gross proceeds received by Abri. The current liability is based on a fair value calculation using the present value of a Black-Scholes
option pricing model to compute the expected cash flows from the Warrants. |
| (J) | On August 7, 2023, Abri held a special meeting of stockholders (the “Special Meeting”).
During the Special Meeting, stockholders approved (a) an amendment to Abri’s amended and restated certificate of incorporation
to permit an extension from August 12, 2023 to February 12, 2024, and (b) to remove the net tangible asset requirement
so that the Company is not required to have net tangible assets of at least $5,000,001 to consummate a Business Combination. In connection
with the stockholders’ vote at the Special Meeting, 570,224 Public Shares were tendered for redemption. As a result, approximately
$6.05 million (approximately $10.62 per share) were removed from Abri’s Trust account to pay such holders. |
| (K) | On August 24, 2023, DLQ entered into a Convertible note for $5,000,000. The note will be converted
into 281 common shares of DLQ, which will be exchanged for 1,600,000 merger consideration shares on the date the Business Combination
is consummated. |
| (L) | Represents full redemption of the Abri shares subject to redemption under the full redemption scenario
based on total cash and equivalents as of June 30, 2023, less transaction costs including deferred underwriting fees of $1,500,000
and estimated transaction costs of $2,378,426. |
(M) Reflects
the reversal of the payments on the settlement of the convertible and promissory notes, in (H), as after the maximum redemption scenario
there would not be sufficient cash on hand to pay off these notes.
DLQ, Inc. and Abri SPAC I, Inc.
Unaudited Pro Forma Condensed Combined Statement of Operations
(In thousands, except per share amounts)
For the Six months Ended June 30, 2023
| | |
For the
Six months
Ended
June 30,
2023 | |
| |
| |
For the
Six months
Ended
June 30,
2023 | |
| |
For the
Six months
Ended
June 30,
2023 |
| | |
DLQ
(Historical) | |
Abri
(Historical) | |
Transaction
Accounting
Adjustments
(Assuming
No
Additional
Redemption) | |
| |
Pro Forma
Combined
(Assuming
No
Additional
Redemption) | |
Transaction Accounting Adjustments (Assuming Maximum Redemption) | |
Pro Forma
Combined
(Assuming
Maximum
Redemption) |
| | |
| |
| |
| |
| |
| |
| |
|
| Revenue: | |
| | | |
| | | |
| | | |
| |
| | | |
| | | |
| | |
| Revenue | |
$ | 8,398 | | |
$ | — | | |
$ | — | | |
| |
$ | 8,398 | | |
$ | — | | |
$ | 8,398 | |
| Operating costs and expenses: | |
| | | |
| | | |
| | | |
| |
| | | |
| | | |
| | |
| Professional fees | |
| — | | |
| 761 | | |
| — | | |
| |
| 761 | | |
| — | | |
| 761 | |
| Platform Operations | |
| 7,583 | | |
| — | | |
| — | | |
| |
| 7,583 | | |
| — | | |
| 7,583 | |
| Depreciation and amortization | |
| 777 | | |
| — | | |
| — | | |
| |
| 777 | | |
| — | | |
| 777 | |
| General and administrative | |
| 2,482 | | |
| 345 | | |
| — | | |
| |
| 2,827 | | |
| — | | |
| 2,827 | |
| Sales and marketing | |
| 60 | | |
| — | | |
| — | | |
| |
| 60 | | |
| — | | |
| 60 | |
| Total operating costs and expenses | |
| 10,902 | | |
| 1,106 | | |
| — | | |
| |
| 12,008 | | |
| — | | |
| 12,008 | |
| Loss from operations | |
| (2,504 | ) | |
| (1,106 | ) | |
| — | | |
| |
| (3,610 | ) | |
| — | | |
| (3,610 | ) |
| Other income (expense): | |
| | | |
| | | |
| | | |
| |
| | | |
| | | |
| | |
| Other (expense)/income, net | |
| (86 | ) | |
| — | | |
| — | | |
| |
| (86 | ) | |
| — | | |
| (86 | ) |
| Interest income | |
| — | | |
| 303 | | |
| (303 | ) | |
AA | |
| — | | |
| — | | |
| — | |
| Change in fair value of warrant liability | |
| — | | |
| (7 | ) | |
| — | | |
| |
| (7 | ) | |
| — | | |
| (7 | ) |
| Total other income (expense) | |
| (86 | ) | |
| 311 | | |
| (142 | ) | |
| |
| (49 | ) | |
| — | | |
| (49 | ) |
| Net loss before income taxes | |
| (2,590 | ) | |
| (795 | ) | |
| (142 | ) | |
| |
| (2,147 | ) | |
| — | | |
| (2,147 | ) |
| Income tax provision | |
| — | | |
| 48 | | |
| — | | |
| |
| 48 | | |
| — | | |
| 48 | |
| Net loss | |
$ | (2,590 | ) | |
$ | (843 | ) | |
$ | (303 | ) | |
| |
$ | (3,641 | ) | |
$ | — | | |
$ | (3,641 | ) |
| | |
| |
| |
Assuming
No Additional
Redemptions | |
Assuming
Maximum
Redemption |
| Weighted common shares outstanding – basic | |
| 2,000 | | |
| 1,252,372 | | |
| 13,840,226 | | |
| 13,158,078 | |
| Weighted common shares outstanding – diluted | |
| 2,000 | | |
| 1,728,078 | | |
| 13,840,226 | | |
| 13,158,078 | |
| Basic net (loss) income per share | |
$ | (1,294.76 | ) | |
$ | (0.00 | ) | |
$ | (0.26 | ) | |
$ | (0.28 | ) |
| Diluted net (loss) income per share | |
$ | (1,294.76 | ) | |
$ | (0.49 | ) | |
$ | (0.26 | ) | |
$ | (0.28 | ) |
Adjustments to Unaudited Pro Forma Condensed Combined
Statements of Operations
The were no material pro forma adjustments
included in the Unaudited Pro Forma Condensed Combined Statement of Operations for the six months ended June 30, 2023, except
for the following:
(AA) Represents the elimination
of interest income earned on investments held in Trust Account
DLQ, Inc. and Abri SPAC I, Inc.
Unaudited Pro Forma Condensed Combined Statement of Operations
(In thousands, except per share amounts)
For the Year Ended December 31, 2022
| | |
For the
Year Ended
December 31,
2022 | |
| |
| |
For the
Year Ended
December 31,
2022 | |
| |
For the
Year Ended
December 31,
2022 |
| | |
DLQ
(Historical) | |
Abri
(Historical) | |
Transaction
Accounting
Adjustments
(Assuming No
Additional
Redemption) | |
| |
Pro Forma
Combined
(Assuming
No
Additional
Redemption) | |
Transaction
Accounting
Adjustments
(Assuming
Maximum
Redemption) | |
Pro Forma
Combined
(Assuming
Maximum
Redemption) |
| | |
| | | |
| | | |
| | | |
| |
| | | |
| | | |
| | |
| Revenue: | |
| | | |
| | | |
| | | |
| |
| | | |
| | | |
| | |
| Revenue | |
$ | 20,236 | | |
$ | — | | |
$ | — | | |
| |
$ | 20,236 | | |
$ | — | | |
$ | 20,236 | |
| Operating costs and expenses: | |
| | | |
| | | |
| | | |
| |
| | | |
| | | |
| | |
| Professional fees | |
| — | | |
| 2,408 | | |
| — | | |
| |
| 2,408 | | |
| — | | |
| 2,408 | |
| Platform Operations | |
| 16,370 | | |
| — | | |
| — | | |
| |
| 16,370 | | |
| — | | |
| 16,370 | |
| Depreciation and amortization | |
| 1,411 | | |
| — | | |
| — | | |
| |
| 1,411 | | |
| — | | |
| 1,411 | |
| General and administrative | |
| 6,730 | | |
| 961 | | |
| — | | |
| |
| 7,691 | | |
| — | | |
| 7,691 | |
| Sales and marketing | |
| 1,205 | | |
| — | | |
| — | | |
| |
| 1,205 | | |
| — | | |
| 1,205 | |
| Transaction costs | |
| — | | |
| — | | |
| 2,378 | | |
BB | |
| 2,378 | | |
| — | | |
| 2,378 | |
| Total operating costs and expenses | |
| 25,716 | | |
| 3,369 | | |
| 2,378 | | |
| |
| 31,463 | | |
| — | | |
| 31,463 | |
| Loss from operations | |
| (5,480 | ) | |
| (3,369 | ) | |
| (2,378 | ) | |
| |
| (11,227 | ) | |
| — | | |
| (11,227 | ) |
| Other income (expense): | |
| | | |
| | | |
| | | |
| |
| | | |
| | | |
| | |
| Other (expense)/income, net | |
| (85 | ) | |
| — | | |
| — | | |
| |
| (85 | ) | |
| — | | |
| (85 | ) |
| Interest income | |
| — | | |
| 834 | | |
| (834 | ) | |
AA | |
| — | | |
| — | | |
| — | |
| Change in fair value of warrant liability | |
| — | | |
| 153 | | |
| — | | |
| |
| 153 | | |
| — | | |
| 153 | |
| Total other income (expense) | |
| (85 | ) | |
| 987 | | |
| (834 | ) | |
| |
| 68 | | |
| — | | |
| 68 | |
| Net loss before income taxes | |
| (5,565 | ) | |
| (2,382 | ) | |
| (3,212 | ) | |
| |
| (11,159 | ) | |
| — | | |
| (11,159 | ) |
| Income tax provision | |
| — | | |
| (119 | ) | |
| — | | |
| |
| (119 | ) | |
| — | | |
| (119 | ) |
| Net loss | |
$ | (5,565 | ) | |
$ | (2,501 | ) | |
$ | (3,212 | ) | |
| |
$ | (11,278 | ) | |
$ | — | | |
$ | (11,278 | ) |
| | |
| |
| |
Assuming
No Additional
Redemptions | |
Assuming
Maximum
Redemption |
| Weighted common shares outstanding – basic | |
| 2,000 | | |
| 5,463,799 | | |
| 13,840,226 | | |
| 13,158,078 | |
| Weighted common shares outstanding – diluted | |
| 2,000 | | |
| 1,728,078 | | |
| 13,840,226 | | |
| 13,158,078 | |
| Basic net (loss) income per share | |
$ | (2,782.66 | ) | |
$ | (0.06 | ) | |
$ | (0.81 | ) | |
$ | (0.86 | ) |
| Diluted net (loss) income per share | |
$ | (2,782.66 | ) | |
$ | (1.25 | ) | |
$ | (0.81 | ) | |
$ | (0.86 | ) |
Adjustments to Unaudited Pro Forma Condensed Combined
Statements of Operations
The were no material pro forma adjustments
included in the Unaudited Pro Forma Condensed Combined Statement of Operations for the year ended December 31, 2022, except for the
following:
(AA) Represents the elimination
of interest income earned on investments held in Trust Account
(BB) Represents preliminary
estimated direct and incremental transaction costs to be incurred. These transaction costs will not recur in the Company’s income
beyond 12 months after the transaction.
NOTES TO UNAUDITED
PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS
| 1. | Basis of Presentation and Accounting Policies |
The Merger is expected to be accounted
for as a reverse recapitalization in accordance with GAAP because DLQ has been determined to be the accounting acquirer under ASC 805
under the no-redemption scenario. Under this method of accounting, Abri will be treated as the “acquired” company for financial
reporting purposes. Accordingly, the consolidated assets, liabilities and results of operations of DLQ will become the historical financial
statements of Collective Audience, Inc., and Abri’s assets, liabilities and results of operations will be consolidated with DLQ
beginning on the acquisition date. For accounting purposes, the financial statements of Collective Audience, Inc. will represent a continuation
of the financial statements of DLQ with the Transaction being treated as the equivalent of DLQ issuing stock for the net assets of Abri,
accompanied by a recapitalization. The net assets of Abri will be stated at historical costs, with no goodwill or other intangible assets
recorded. Operations prior to the Merger will be presented as those of DLQ in future reports of Collective Audience, Inc. The Company
has also considered the provisions of ASC 805 in making the statements that the transaction is intended to be accounted for as a
reverse recapitalization and that the Company believes DLQ is the accounting acquirer under both a no redemption and a maximum redemption
scenario.
Upon consummation of the Merger, the Combined
Company will perform a comprehensive review of the two entities’ accounting policies. As a result of the review, management may
identify differences between the accounting policies of the two entities which, when conformed, could have a material impact on the financial
statements of the Combined Company.
| 2. | Adjustments to Unaudited Pro Forma Condensed Combined Financial Information |
The unaudited pro forma condensed combined
financial information has been prepared in accordance with Article 11 of Regulation S-X. The adjustments in the unaudited
pro forma condensed combined financial information have been identified and presented to provide relevant information necessary for an
illustrative understanding of Collective Audience, Inc. upon consummation of the Merger in accordance with GAAP. Assumptions and
estimates underlying the unaudited pro forma adjustments set forth in the unaudited pro forma condensed combined financial information
are described in the accompanying notes.
The unaudited pro forma condensed combined
financial information has been presented for illustrative purposes only and is not necessarily indicative of the operating results and
financial position that would have been achieved had the Merger occurred on the dates indicated, and does not reflect adjustments for
any anticipated synergies, operating efficiencies, tax savings or cost savings. Any cash proceeds remaining after the consummation of
the Merger and the other related events contemplated by the Merger Agreement are expected to be used for general corporate purposes. The
unaudited pro forma condensed combined financial information does not purport to project the future operating results or financial position
of Collective Audience, Inc. following the completion of the Merger. The unaudited pro forma adjustments represent management’s
estimates based on information available as of the date of these unaudited pro forma condensed combined financial information and are
subject to change as additional information becomes available and analyses are performed. Abri and DLQ have not had any historical relationship
prior to the transactions. Accordingly, no pro forma adjustments were required to eliminate activities between the companies.
The unaudited pro forma condensed combined
financial information contained herein assumes that the Abri stockholders approve the Merger. Pursuant to its existing charter, Abri will
provide stockholders the opportunity to redeem the outstanding shares of common stock for cash equal to their pro rata share of the aggregate
amount on deposit in the Trust Account, which holds the proceeds of Abri’s IPO, as of two business days prior to the consummation
of the transactions contemplated by the Merger Agreement (including interest earned on the funds held in the Trust Account, net of taxes)
upon the closing of the transactions contemplated by the Merger Agreement.
The level of redemptions assumed in the
Unaudited Pro Forma Condensed Combined Balance Sheet and Statements of Operations are based on the assumption that there are no adjustments
for the outstanding Public Warrants issued in connection with the IPO as such securities are not exercisable until the later of the completion
of an initial business combination and February 12, 2024.
The following summarizes the pro forma
shares of Collective Audience, Inc. Common Stock issued and outstanding immediately after the Merger, presented under the above scenarios:
| | |
Assuming No Additional
Redemption | | |
Assuming Maximum
Redemption | |
| | |
| Shares | | |
| % | | |
| Shares | | |
| % | |
| DLQ Parent, Parent Stockholders and PIPE Investors | |
| 11,400,000 | (1) | |
| 82.4 | % | |
| 11,400,000 | | |
| 86.6 | % |
| Abri Stockholders | |
| 2,410,226 | | |
| 17.4 | % | |
| 1,728,078 | | |
| 13.1 | % |
| Representative Shareholders | |
| 30,000 | | |
| 0.2 | % | |
| 30,000 | | |
| 0.2 | % |
Pro Forma Common Stock at December 31,
2022 | |
| 13,840,226 | | |
| 100.0 | % | |
| 13,158,078 | | |
| 100.0 | % |
| (1) | The 11,400,000 shares for DLQ Parent, Parent Stockholders and PIPE Investors represent the aggregate shares
of Abri common stock to be issued by Abri in exchange for the 2,000 outstanding common shares of DLQ as of June 30, 2023 and the
additional 281 common shares of DLQ, which will be exchanged for 1,600,000 merger consideration shares on the date the Business Combination
is consummated. The warrants outstanding have not been included in the diluted EPS, as they would be anti-dilutive. |
If the actual facts are different than
these assumptions, then the amounts and shares outstanding in the unaudited pro forma condensed combined financial information will be
different and those changes could be material.
Assumptions and estimates underlying the
unaudited pro forma adjustments set forth in the unaudited pro forma condensed combined financial statements are described in the accompanying
notes. The unaudited pro forma condensed combined financial statements have been presented for illustrative purposes only and are not
necessarily indicative of the operating results and financial position that would have been achieved had the Merger occurred on the dates
indicated. Further, the unaudited pro forma condensed combined financial statements do not purport to project the future operating results
or financial position of Collective Audience, Inc. following the completion of the Merger. The unaudited pro forma adjustments represent
Collective Audience, Inc. management’s estimates based on information available as of the dates of these unaudited pro forma condensed
combined financial statements and are subject to change as additional information becomes available and analyses are performed.
The pro forma basic and diluted income
per share amounts presented in the Unaudited Pro Forma Condensed Combined Statement of Operations are based upon the number of the Combined
Company’s shares outstanding, assuming the Business Combination occurred on January 1, 2022.
Loss per share represents the income per
share calculated using the historical weighted average shares outstanding, and the issuance of additional shares in connection with the
Business Combination, assuming the shares were outstanding since January 1, 2021. As the Business Combination and related equity
transactions are being reflected as if they had occurred at the beginning of the periods presented, the calculation of weighted average
shares outstanding for basic and diluted net income per share assumes that the shares issuable relating to the Business Combination have
been outstanding for the entirety of all periods presented. The Abri SPAC I public and private warrants, totaling 6,028,518, have
been excluded from the pro forma diluted net loss per share calculations because they are anti-dilutive. The number of private warrants
that were excluded from the computation of diluted EPS because their impact was anti-dilutive was 294,598. In addition, the shares pursuant
to the earnout arrangements discussed above have been excluded because the shares are contingently issuable or forfeitable and the contingencies
have not been resolved.
| | |
For the
Six months
Ended
June 30,
2023 | |
For the
Six months
Ended
June 30,
2023 |
| | |
Assuming No
Additional
Redemption | |
Assuming
Maximum
Redemption |
| Pro forma net loss | |
$ | (3,640,056 | ) | |
$ | (3,640,056 | ) |
| Weighted average shares outstanding of common stock – basic | |
| 13,840,226 | | |
| 13,158,078 | |
| Weighted average shares outstanding of common stock – diluted | |
| 13,840,226 | | |
| 13,158,078 | |
| Net loss per share attributable to common stockholders – basic | |
$ | (0.26 | ) | |
$ | (0.28 | ) |
| Net loss per share attributable to common stockholders – diluted | |
$ | (0.26 | ) | |
$ | (0.28 | ) |
| | |
For the
Year Ended
December 31,
2022 | |
For the
Year Ended
December 31,
2022 |
| | |
Assuming
No Additional
Redemption | |
Assuming
Maximum
Redemption |
| Pro forma net loss | |
$ | (11,278,330 | ) | |
$ | (11,278,330 | ) |
| Weighted average shares outstanding of common stock – basic | |
| 13,840,226 | | |
| 13,158,078 | |
| Weighted average shares outstanding of common stock – diluted | |
| 13,840,226 | | |
| 13,158,078 | |
| Net loss per share attributable to common stockholders – basic | |
$ | (0.81 | ) | |
$ | (0.86 | ) |
| Net loss per share attributable to common stockholders – diluted | |
$ | (0.81 | ) | |
$ | (0.86 | ) |
ABRI’S DIRECTORS AND EXECUTIVE OFFICERS
Current Directors and Executive Officers
Abri’s directors and executive officers
are as follows as of the Record Date:
| Name |
|
Age |
|
Position |
| Jeffrey Tirman |
|
59 |
|
Chairman of the Board of Directors and Chief Executive Officer |
| Nima Montazeri |
|
46 |
|
Executive Vice President, Chief Operating Officer and Director |
| Christopher Hardt |
|
57 |
|
Chief Financial Officer |
| Peter Bakker |
|
69 |
|
Vice President of Business Analytics |
| Amy Wall |
|
48 |
|
Vice President |
| John Wepler |
|
54 |
|
Director |
| Joseph Schottland |
|
52 |
|
Director |
| Nadine Watt |
|
54 |
|
Director |
Jeffrey Tirman
is Chairman of Abri’s Board of Directors and Chief Executive Officer. Mr. Tirman has over 30 years of international investment
and corporate management experience, specializing in discrete corporate transactions, senior corporate strategy development and management,
turnarounds, and restructurings (operational and financial). Since beginning his career, Mr. Tirman has executed and structured several
complex international corporate transactions both on behalf of independent shareholders and as primary shareholder. Mr. Tirman has
also negotiated, executed and participated in numerous types of transactions, including public listings, spin-offs, administration proceedings,
organizing and leading creditor committees, corporate rationalizations, acquisitions and divestitures, and balance sheet refinancing,
as well as analyzing and executing numerous debt and equity investments and capital structure arbitrage positions. Mr. Tirman founded
Abri Advisors Ltd, in Bermuda in 2016 and Abri Advisors (UK) Ltd. in the United Kingdom in 2020 to invest across a variety of asset classes,
and to provide corporate advisory services focused on corporate turnarounds and restructuring. Mr. Tirman is also the managing member
and a director of Abri Ventures 2, LLC, and chief executive officer of Abri Sponsor Company Ltd, and Abri Advisors, Inc., both private
equity holding companies. Since May 12, 2022, Mr. Tirman has served as the chief Executive Officer and Chairman of the Board
of Abri SPAC 2, Inc., a special purpose acquisition company (“Abri 2”). Mr. Tirman also serves as
the managing member and a director of Abri Ventures I, LLC, our Sponsor. Since January 2016, Mr. Tirman had been the Chairman
and CEO, and still serves as CEO of Elan d.o.o., based in Slovenia, and sits on the boards of several Elan subsidiaries. Since May 2019,
Mr. Tirman has been the CEO and Director of Luxembourg-based KJK Sports S.A. and sits on the boards of several holdings thereunder
including Tahe Outdoors based in France and Estonia, Baltic Vairus based in Lithuania, and Leader 96 based in Bulgaria. As of June 30,
2021, these companies employed more than 3,000 people and generated revenues in excess of €350 million. Mr. Tirman is charged
with leading the operational and financial restructuring of these companies with the aim of increasing operational efficiency, financial
performance and transparency, along with the implementation of standardized business practices and transparent corporate governance principles.
From 2009 through
2014, Mr. Tirman was an adjunct professor of Advanced Corporate Finance for the Master of Sciences in Finance (MScF) program at l’Ecole
des Hautes Etudes Commerciales (HEC) in Lausanne, Switzerland, which is a joint effort between l’Université de Lausanne (UNIL),
Ecole Polytechnique Fédérale de Lausanne (EPFL) and the Federal Swiss Banking and Finance Institute. From 2011 through 2013,
Mr. Tirman was also a guest lecturer on Credit Markets and Credit Risk for the Asset and Wealth Management Executive MBA (AWEMBA)
program at the HEC, which was a joint program between University of Lausanne and the Tepper School of Management at Carnegie Mellon University,
in Pennsylvania, USA. Mr. Tirman’s lectures focused on risk assessment and analysis. Mr. Tirman holds an MBA in Corporate
Tax & Accounting from Tulane University and a BA in Economics & Finance at the University of Arkansas.
Nima Montazeri
is Abri’s Executive Vice President, Chief Operating Officer and Director. Mr. Montazeri has more than 21 years of
experience in corporate finance and is experienced in matters related to financing public and private companies. Mr. Montazeri has
substantial experience in structuring complex financing instruments and private placements for small and mid-cap public companies,
including working with many companies to design and implement operational and management restructuring plans. Mr. Montazeri is also
the chief operating officer of Abri Advisors Ltd, in Bermuda, and Abri Advisors (UK) Ltd. Mr. Montazeri has advised numerous small
and mid-cap companies on growth strategies with a focus on international business development and expansion. Since May 12, 2022,
Mr. Montazeri has served as the Chief Operating Officer and Director of Abri 2. Since March 2017, Mr. Montazeri has been
a general partner at Brown Stone Capital, LP., focused on investment management. Previously, from 2008 to 2017, Mr., Montazeri was a Managing
Director at Floyd Associates, Inc., leading management and financial consulting efforts and investing across multiple asset classes. Since
2012, Mr. Montazeri has been an active money manager focused on equity, fixed income, real estate, and derivative strategies. Mr. Montazeri
has assisted several clean energy and automotive solution companies with their capital development efforts by organizing access to strategic
sources of capital, as well as advising on new and expanding markets. Furthermore, he played an instrumental role in raising international
capital for a California based concentrated solar power company. In 2003 he led an innovative technology transfer program from NASA’s
Jet Propulsion Laboratory which resulted in the development of a novel biological detection instrument. Mr. Montazeri has an extensive
network of international investment and finance relationships providing access to a variety of transactions and differentiated investment
opportunities, along with a robust capital raising network.
Furthermore,
Mr. Montazeri is the author of several research reports related to clean energy, defense, counter terrorism, and natural resources.
As an economist, he has conducted extensive research on international trade, openness, and the resulting impact on economic growth. Mr. Montazeri’s
research covered the analysis of thousands of historical bilateral trade figures in an attempt to discover statistically significant correlations
between openness to trade and real economic growth. Mr. Montazeri holds a BA with honors in Economics from the University of British
Columbia and a Master’s in Finance and Accounting from the London School of Economics and Political Science.
Christopher Hardt, Abri’s
Chief Financial Officer and director, has more than 30 years of Big 4 audit, compliance, reporting and international corporate advisory
experience. Mr. Hardt recently retired from PwC LLP where he was an audit partner since 2000. Since May 12, 2022, Mr. Hardt
has served as the Chief Financial Officer and Director of Abri 2. Mr. Hardt is also the chief financial officer of Abri Advisors
Ltd, in Bermuda, and Abri Advisors (UK) Ltd. Mr. Hardt has been based previously in PwC’s offices in London, England, Lausanne,
Switzerland and Tokyo, Japan in addition to several offices in the United States. During his tenure at PwC, he was a lead partner
on several large multinational audit clients in the Consumer Markets, Technology, Media, Automotive, Banking and Insurance industries
and has conducted business in over 40 countries. Mr. Hardt has also served as a leader in PwC’s SEC Services group in the firm’s
National Office where he was responsible for oversight of both foreign and domestic registrant client SEC filings including both debt
and equity IPOs. In his prior roles at PwC, Mr. Hardt has extensive experience with companies preparing to go public including the
financial statement and internal controls requirements of The Sarbanes-Oxley Act, interacting with the SEC and the financial reporting
implications of executing growth strategies involving mergers and acquisitions. Mr. Hardt also has many years of experience
interacting with public company boards of directors and their audit/finance committees. Mr. Hardt is an investor and adviser to Cavan &
Co LLC, an early-stage American made lifestyle apparel brand. Mr. Hardt holds a BA in Business Administration from Furman University
and is a CPA licensed in Ohio, Georgia and New Jersey. Mr. Hardt serves on the Board of Prime Living Partners Inc. and recently completed
successive terms on both the President’s Advisory Council of Furman University and the Parents Board at The Georgia Institute of
Technology.
Peter Bakker is
Abri’s Vice President of Business Analytics. Mr. Bakker has more than 30 years of experience in high-yield debt finance,
portfolio management, secured lending, and SME trade finance. Since May 12, 2022, Mr. Bakker has served as the Vice President
of Business Analytics of Abri 2. Mr. Bakker has been a Vice President at Abri Advisors Ltd. since June 2019, focused on corporate
evaluation and M&A. From January 2015 to June 2019, Mr. Bakker was the Chief Risk Officer at Channel Capital Advisors,
where he oversaw risk management. Mr. Bakker has extensive knowledge of credit analysis and debt service capacity of corporate borrowers;
the turnaround/workout/recovery process; financial restructuring; valuation and analysis of highly levered and distressed capital structures;
and arranging financing for SME’s. Mr. Bakker’s extensive international experience includes bank lending to finance leveraged
buyouts, distressed investing on behalf of institutional clients, advising a leading Canadian hedge fund on its leveraged loan portfolio,
and managing risk and workouts for a European FinTech platform providing financing to SME’s. He has also directly led the restructuring
of several distressed SME’s, and he has raised significant leveraged acquisition financing and arranged several pre-pack bankruptcies
in order to facilitate financial restructuring. Mr. Bakker holds an MBA in Business Administration from the Tuck School of Business
at Dartmouth University and an MS in Economics from Erasmus University.
Amy Wall, our
Vice President of Operations, has more than 20 years of experience in financial controlling, international operations, and back-office administration.
Since May 12, 2022, Mrs. Wall has served as the Vice President of Operations of Abri 2. Mrs. Wall has been VP of Operations
for Abri Advisors Ltd. since its founding in 2016, where she manages all corporate organizational matters as well as financial reporting
and controlling. From 2013 to 2016, Mrs. Wall was the financial accountant and controller for FCA/SEC regulated Rhodium Capital based
in London. From 1998 to 2016, Mrs. Wall served as the financial accountant, controller and back-office operations manager for
SEC regulated Talisman Capital. Mrs. Wall and Mr. Tirman have worked together since 1998.
John Wepler serves as a director
on Abri’s board. As Chairman and Chief Executive Officer of Marsh, Berry & Co., Inc. and CEO of the wholly-owned FINRA
registered broker/dealer MarshBerry Capital, Inc., Mr. Wepler’s leadership and industry experience has benefited many insurance
industry professionals in an insurance career spanning nearly three decades. He has been a vital resource in mergers and acquisitions
(M&A), having personally advised on more than 250 insurance-related M&A transactions since joining MarshBerry in 1991. Mr. Wepler’s
stewardship in the insurance industry has positioned him over the years as a sought-after adviser and chairperson for a range of
organizations. He currently serves as an adviser to the board for the Worldwide Broker Network. Previous board positions include the Chairman
of the Board of the Midwest Division of the Insurance Industry Charitable Foundation (IICF), the IICF’s national Board of Governors,
Independent Insurance Agents & Brokers of New York, the American Bankers Insurance Association and adviser to the Disabled
Veterans Insurance Careers (DVIC) Board. Mr. Wepler is an in-demand industry speaker because of his extensive knowledge in organic
growth management, valuation enhancement strategies, business planning, perpetuation, financial management and M&A. He is often
a keynote speaker at insurance carrier elite meetings, national conferences and leadership forums, including Council of Insurance Agents &
Brokers conferences, Chubb Wharton Executive Leadership Training, Selective Executive Symposiums and S&P Global Market Intelligence
investment workshops. With extensive experience in all facets of insurance business planning, from organic growth to perpetuation, Mr. Wepler’s
skill set allows for designing innovative, progressive strategies that help owners as they work to realize their business goals and life’s
dreams. Mr. Wepler holds an MBA from Kent State University and a Bachelor’s degree in Finance from Ohio University.
Joseph Schottland serves as a director
on Abri’s board. Mr. Schottland has more than 20 years of experience in investment management and corporate consulting.
Mr. Schottland has a demonstrated history of working in the investment management industry with strong entrepreneurship and expertise
in corporate valuation, business strategy, management consulting, financial modelling and restructuring. Since February 2021, Mr. Schottland
has been the CEO of AMWCO LLC, a residential real estate FinTech platform. Since January 2016, Mr. Schottland has also been
a partner at Innovatus Capital Partners, a private equity firm focused on investing in growth, disruptive and distressed opportunities.
From 2011 until the end of 2015, Mr. Schottland was a Partner at McKinsey & Co. where he focused on restructuring, strategy
and advisory work, including the American Airlines bankruptcy and its subsequent merger with US Airways. From 2004 until 2010, he was
a Senior Managing Director at Seabury Group, providing strategic and operational advisory and investment banking services to the aviation
and aerospace industries. Prior to that. Mr. Schottland was at Bain & Co. Mr. Schottland holds an MBA in Corporate
Strategy and Finance from Columbia Business School and a BS in Economics and American History from New York University.
Nadine Watt serves as a director
on Abri’s board. Since May 12, 2022, Ms. Watt has served as a Director of Abri 2. Since December 2019, Ms. Watt has served
as CEO of Watt Companies. She oversees the day-to-day activities and strategic planning for all commercial investment activities
including acquisitions, development, and asset management for the Watt Companies’ 6 million-square-foot portfolio. Ms. Watt
has served on the Board of Directors of Fisker, Inc. since June 2020. Fisker, Inc. is an eco-friendly electric vehicles manufacturer.
Ms. Watt served as President of Watt Companies from 2011 to 2019. In 2011, she led a strategic reorganization of the company that moved
the firm beyond traditional property management and leasing to a focus on acquisitions and real estate development, as well as joint venture
opportunities. Ms. Watt played a key role in launching Watt Companies’ acquisition division — Watt Investment Partners — that
now actively invests $60 million in a variety of property types across the Western United States., Ms. Watt is a member of the
University of Southern California Board of Governors and the Sol Price School of Public Policy Board of Councilors and serves on the Executive
Committee of the Lusk Center for Real Estate as well as the USC Associates Board of Directors. She was the first woman to be named Chair
of the Los Angeles Business Council, a position she still holds. She is a Board Member of Visionary Women and the City of Hope Los Angeles
Real Estate & Construction Industries Council. Ms. Watt received the Century City Citizen of the Year award in 2017 and the EY
Entrepreneur of the Year award in 2018. A graduate of Georgetown University School of Foreign Service, Ms. Watt also holds a Master of
Arts degree from the School of Cinematic Arts at the University of Southern California.
Audit Committee
Our Audit Committee has been established
in accordance with Section 3(a)(58)(A) of the Exchange Act and consists of Messrs. Wepler and Schottland, and Ms. Watt,
each of whom are independent directors and are “financially literate” as defined under the Nasdaq listing standards. Our Board
has determined that Mr. Schottland qualifies as an “audit committee financial expert,” as defined under rules and regulations
of the SEC.
The audit committee’s duties, which
are specified in our Audit Committee Charter, include, but are not limited to:
| · | 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; |
| · | discussing with management and the independent auditor
significant financial reporting issues and judgments made in connection with the preparation of our financial statements; |
| · | discussing with management major risk assessment and
risk management policies; |
| · | monitoring the independence of the independent auditor; |
| · | 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; |
| · | reviewing and approving all related-party transactions; |
| · | inquiring and discussing with management our compliance
with applicable laws and regulations; |
| · | 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; |
| · | appointing or replacing the independent auditor; |
| · | 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; |
| · | establishing procedures for the receipt, retention and
treatment of complaints received by us regarding accounting, internal accounting controls or reports which raise material issues regarding
our financial statements or accounting policies; and |
| · | approving reimbursement of expenses incurred by our
management team in identifying potential target businesses. |
Compensation Committee
Our Compensation Committee consists of
Mr. Wepler, and Ms. Watt, each of whom is an independent director. Pursuant to our Compensation Committee charter, the functions
of the Compensation Committee include, but not limited to:
| · | 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 based on
such evaluation; |
| · | reviewing and approving the compensation of all of our
other executive officers; |
| · | reviewing our executive compensation policies and plans; |
| · | implementing and administering our incentive compensation
equity-based remuneration plans; |
| · | assisting management in complying with our proxy statement
and annual report disclosure requirements; |
| · | approving all special perquisites, special cash payments
and other special compensation and benefit arrangements for our executive officers and employees; |
| · | if required, producing a report on executive compensation
to be included in our annual proxy statement; and |
| · | reviewing, evaluating and recommending changes, if appropriate,
to the remuneration for directors. |
The charter provides that the compensation
committee may, in its sole discretion, retain or obtain the advice of a compensation consultant, legal counsel or other adviser and will
be directly responsible for the appointment, compensation and oversight of the work of any such adviser. However, before engaging or receiving
advice from a compensation consultant, external legal counsel or any other adviser, the compensation committee will consider the independence
of each such adviser, including the factors required by Nasdaq and the SEC.
Nominating Committee
We do not have a standing nominating committee,
though we intend to form a corporate governance and nominating committee as and when required to do so by law or Nasdaq rules. In accordance
with Rule 5605(e)(2) of the Nasdaq rules, a majority of the independent directors may recommend a director nominee for selection
by the board of directors. The board of directors believes that the independent directors can satisfactorily carry out the responsibility
of properly selecting or approving director nominees without the formation of a standing nominating committee. Messrs. Wepler and Schottland,
and Ms. Watt will participate in the consideration and recommendation of director nominees. In accordance with Rule 5605(e)(1)(A) of
the Nasdaq rules, all such directors are independent. As there is no standing nominating committee, we do not have a nominating committee
charter in place.
The board of directors will
also consider director candidates recommended for nomination by our stockholders during such times as they are seeking proposed nominees
to stand for election at the next annual meeting of stockholders (or, if applicable, a special meeting of stockholders). Our stockholders
that wish to nominate a director for election to the Board should follow the procedures set forth in our bylaws.
We have not formally established
any specific, minimum qualifications that must be met or skills that are necessary for directors to possess. In general, in identifying
and evaluating nominees for director, the board of directors considers educational background, diversity of professional experience, knowledge
of our business, integrity, professional reputation, independence, wisdom, and the ability to represent the best interests of our stockholders.
Employment Agreements
Abri has not entered into
any employment agreements with its executive officers, and has not made any agreements to provide benefits upon termination of employment.
Executive Officers and Director Compensation
None of our officers has received
any cash compensation for services rendered to us. We have agreed to pay an affiliate of our Chief Executive Officer a total of $10,000
per month for office space and certain office and secretarial services. However, this arrangement is solely for our benefit and is not
intended to provide our Chief Executive Officer compensation in lieu of a salary. Upon completion of our initial business combination
or our liquidation, we will cease paying these monthly fees. No other compensation of any kind, including any finder’s fee, reimbursement,
consulting fee or monies in respect of any payment of a loan, will be paid by us to the Sponsor, officers and directors, or any affiliate
of the Sponsor or officers, prior to, or in connection with any services rendered in order to effectuate, the consummation of our initial
business combination (regardless of the type of transaction that it is). However, these individuals will receive reimbursement for any
out-of-pocket expenses incurred by them in connection with activities on our behalf, such as identifying potential target businesses,
performing business due diligence on suitable target businesses and business combinations as well as traveling to and from the offices,
plants or similar locations of prospective target businesses to examine their operations. 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, such expenses would not be reimbursed by us unless we consummate an initial business combination. Our audit committee will review
and approve all reimbursements made to the Sponsor, officers, directors or their respective affiliates, with any interested director abstaining
from such review and approval.
DIRECTORS, EXECUTIVE OFFICERS AND CERTAIN SIGNIFICANT
EMPLOYEES OF DLQ
In this section and unless
the context otherwise requires, references to “DLQ” refers to DLQ, Inc. prior to Closing.
Directors, Executive Officers, and Certain
Significant Employees
The following table sets forth
information regarding DLQ’s executive officers, directors and certain significant employees, including their ages as of September
28, 2023
| Name | |
Age | |
Position |
| Brent Suen | |
55 | |
Chairperson of the Board, Chief Executive Officer, Chief Financial Officer, Secretary and Treasurer of DLQ |
| Robb Billy | |
49 | |
Chief Executive Officer of BattleBridge Labs. |
| Haig Newton | |
46 | |
Chief Executive Officer of Push Interactive, LLC |
| Chris Andrews | |
46 | |
Chief Operating Officer of Logiq, Inc. |
| Bennett Robinson | |
34 | |
Senior Vice President of Product, Logiq, Inc. |
| Mitchell Savage | |
60 | |
Director of Marketing of Logiq, Inc. |
| Travis Phipps | |
49 | |
Founder and Chief Anarchist of BattleBridge Labs |
Brent Suen, President, Chief Executive Officer,
Principal Financial Officer and Director
Mr. Suen currently
serves as DLQ’s sole director and officer. Mr. Suen previously served as Chief Executive Officer at Logiq, Inc., a Delaware
corporation (“Logiq DE”) (OTCQX:LGIQ) Chief Executive Officer until September 1, 2020 and was re-appointed on
January 7, 2022, and has been President of Logiq DE since November 19, 2014, and a director of Logiq DE since November 19,
2014. Mr. Suen has 27 years of experience in the investment banking industry. He began his career in merger arbitrage at Bear
Stearns in 1988. In 1993, he founded Axis Trading Corp., one of the first online platforms for stock trading and subsequently sold it
to a division of Softbank in 1996. In 1997, he co-founded Elevation Capital which invested in and advised Silicon Valley based companies
on IPO’s, mergers and acquisitions, strategic partnerships and fund raising. In 2003 Brent moved to Hong Kong and China where
he established Bay2Peak S.A. Bay2Peak has invested in and advised over fifty companies which include Internet, software, renewable
energy and life science companies. From 2006 to 2008 he also advised IRG TMT Asia Fund on private and public investments. In 2012 Brent
served as advisor to McLarty Group and Citibank Venture Capital on a sale/leaseback program valued at $160 million leading to the
eventual sale of the company for $630 million. For the past six years, Brent led the start-up and management of Empirica
S.A., a security/intelligence and frontier markets focused advisory firm operating in Asia, the Middle East, Africa and Central Asia.
Mr. Suen holds a BA degree in Marketing from the University of Arkansas at Little Rock.
Robb Billy, Chief Financial Officer, BattleBridge
Labs.
Mr. Billy
has experience managing and overseeing a business’ human resources, finance, information technology, real estate, insurance, risk
management and aircraft management departments. Since January 2020, Mr. Billy has served as a Partner and Chief Financial Officer
of BattleBridge Labs. From November 2020 to January 2022, he served as the Chief Executive Officer of Vineyard Fruit &
Vegetable Company. For 11 years, from July 2008 to September 2019, Mr. Billy served as the Chief Financial Officer
of Bob Mills Furniture. From July 1999 to June 2008, he served as the Director of Corporate Accounting at Associated Wholesale
Grovers. Mr. Billy received a Bachelor’s of Science in Accounting from the University of Tulsa.
Haig Newton, Chief Financial Officer, Push
Interactive.
Since July 2020, Mr. Newton
has served as President of Logiq, Inc., a Delaware corporation (OTCQX:LGIQ). Mr. Newton is also the Co-Founder and Chief Executive
Officer of Push Interactive LLC, a wholly-owned subsidiary of DLQ, Inc, and has been since January 2010. Concurrently, since 2012
he has served as Chief Executive Officer of Tamble, Inc., a wholly-owned subsidiary of DLQ. Since 2014 he has also served as the
Co-Creator, Partner and Developer at @Glenwood a business campus in Minneapolis Minnesota. From March 2017 to April 2021, he
served as the Chief Executive Officer and President of ConversionPoint Technologies, Inc. Mr. Newton received his Bachelor of Science
in Business and Advertising with a minor in Computer Science from the University of Kansas.
Chris Andrews.,
Chief Operating Officer, Logiq, Inc.
Mr. Andrews
has served as the Chief Operating Officer Logiq, Inc., a Delaware corporation (OTCQX:LGIQ) since January 2, 2023. Mr. Andrews
previously served as the Chief Digital Officer of MediaJel, Inc. from June 15, 2021 to December 31, 2022, a digital marketing
company for businesses in regulated industries. Prior to that, Mr. Andrews held the Chief Digital Officer role of Kubient, Inc. (Nasdaq:
KBNT) from June 17, 2019 to May 31, 2021. From March 2017 to June 2019, he was employed as the Chief Technology Officer of Ogilvy
CommonHealth Worldwide, a healthcare-focused marketing, branding and advertising agency that is a subsidiary of WPP plc (NYSE:WPP),
arguably the world’s largest advertising company. From November 2006 to February 2017, he was the Chief Information Officer of Ogilvy
CommonHealth Worldwide. Mr. Andrews holds a Bachelor of Science and Masters of Business Administration from the New Jersey Institute
of Technology.
Bennett Robinson, SVP Product, Logiq, Inc.
Mr. Robinson, has been
the SVP Product at Logiq, Inc. (OTCQX:LGIQ) since July 2020 where he coordinates the UX, engineering and business requirements. Previously,
from 2008 to 2020 he served as the VP of Product Management of Push Interactive, LLC. From 2013 to 2020, he was a Project Manager,
and from 2017 to 2018 was the VP of Operations at Push Interactive, LLC. He was a Systems Analyst from 2012 to 2016 and a Data Operations
Manager in 2013 at Push Interactive, LLC. Mr Robinson received his Bachelor of Science from in Elementary Education and Teaching
from the University of Wisconsin- River Falls. He received his Project Management Certification from the Project Management Institute
in 2019.
Mitchell Savage, Director of Marketing,
Logiq, Inc.
Mr. Savage, has served
as the Director of Marketing of Logiq, Inc. (OTCQX:LGIQ) since March 2022. Prior, since 2017, he served as the Director of Marketing
for BattleBridge Labs. Concurrently, Mr. Savage is the Principal of Perpetual Sales/Mitchell Savage Business Advisors and has been
since April 2003. From 2015 to 2017, he served as Business and Product Strategy for HIPAA Help Center and from 2013 to 2015 he was
Co-Founder and Managing Partner at Vissero Group, an investment advisory firm. Mr. Savage received his Bachelor of Science in Management
Information Systems from the University of Tulsa, and his Master of Business Administration in International Business from the University
of Tulsa.
Travis Phipps, Director of Marketing, Logiq,
Inc
Since 2009, Mr. Phipps
has been the Founder and Chief Anarchist of BattleBridge, which was acquired by DLQ in 2022. Since 2008 he has been the Managing Director
of TR Phipps Consulting where he consulted companies regarding internet marketing, AdWords and Bing PPC, SEO, email marketing and more.
From 2012 to 2014, he was the VP Sales and Marketing of ExpertHelp.com, a site that provides immediate answers to technical questions.
From 2009 to 2014, he was the Director/Co-Founder of CherryLoop.com where was responsible for all internet marketing. Mr. Phipps
received his Bachelor of Business Administration in Marketing and Spanish from the University of Oklahoma.
Executive Compensation
DLQ intends to enter into
employment agreements with its named executive officers after Closing. Currently, DLQ’s sole executive officer receives a base salary
through DLQ Parent to compensate them for services rendered to DLQ, DLQ Parent and all subsidiaries. The base salary is intended to provide
a fixed component of compensation reflecting the executive’s skill set, experience, position and responsibilities.
Involvement in Certain Legal Proceedings
None of DLQ’s directors
or executive officers has been involved in any events requiring disclosure under Item 401(f) of Regulation S-K.
Board Composition
DLQ’s board of directors
consists of at least one (1) and not more than five (5) directors. DLQ currently has one director. The number of directors
is fixed from time to time by resolution of a majority of the members of the board of directors or the stockholders of DLQ holding at
least a majority of the voting power of DLQ’s outstanding stock then entitled to vote at an election of directors. Each director
holds office until the next annual meeting of stockholders and until such director’s successor is elected and qualified, or until
such director’s earlier death, resignation or removal. Any director may resign at any time upon written notice to DLQ.
DLQ’s officers are appointed
by its board of directors and serve until such person’s successor is appointed or until such person’s earlier resignation,
death or removal. Any number of offices may be held by the same person. DLQ’s board of directors is authorized to appoint persons
to the offices set forth in its bylaws as it deems appropriate. DLQ’s bylaws provide that its officers shall consist of a Chief
Executive Officer, a Secretary and a Treasurer and may consist of such other officers, including assistant officers and agents, as may
be from time to time appointed by DLQ’s board of directors.
Director Independence
DLQ’s board of directors
currently consists of one (1) member, Brent Suen. DLQ’s board of directors has determined that none of its directors, are “independent”
directors in accordance with the rules of the SEC and the Nasdaq Listing Rules. Mr. Suen is not considered independent because he
is an executive officer of DLQ.
Leadership Structure of the Board
DLQ’s bylaws and corporate
governance guidelines provide its board of directors with flexibility to combine or separate the positions of Chairperson of the board
of directors and Chief Executive Officer.
DLQ’s board of directors
has concluded that its current leadership structure is appropriate at this time. However, DLQ’s board of directors will continue
to periodically review its leadership structure and may make such changes in the future as it deems appropriate.
Role of Board in Risk Oversight Process
Risk assessment and oversight
are an integral part of DLQ’s governance and management processes. The board of directors encourages management to promote a culture
that incorporates risk management into DLQ’s corporate strategy and day-to-day business operations. Management discusses strategic
and operational risks at regular management meetings, and conducts specific strategic planning and review sessions during the year that
include a focused discussion and analysis of the risks facing DLQ. DLQ’s board of directors does not have a standing risk management
committee, but rather administers this oversight function directly through DLQ’s board of directors as a whole, as well as through
various standing committees of the board of directors that address risks inherent in their respective areas of oversight. While DLQ’s
board of directors is responsible for monitoring and assessing strategic risk exposure, the audit committee is responsible for overseeing
DLQ’s major financial risk exposures and the steps management has taken to monitor and control these exposures.
Board Committees
DLQ’s board of directors
has not established a separately standing audit committee, compensation committee and nominating committee. The board of directors may
establish committees to facilitate the management of DLQ’s business.
Code of Business Conduct and Ethics
The board of directors has
not adopted a code of Business Conduct and Ethics that applies to all of DLQ’s executive officers, directors and employees.
EXECUTIVE AND DIRECTOR COMPENSATION
In
this section and unless the context otherwise requires, references to “DLQ” refers to DLQ, Inc. prior to Closing. This discussion
may contain forward-looking statements that are based on our current plans, considerations, expectations, and determinations regarding
future compensation programs. Actual compensation programs that we adopt following the completion of the Business Combination may differ
materially from the currently planned programs summarized in this discussion.
Abri
None
of our executive officers or directors have received any cash compensation for services rendered to us. Our executive officers and directors
and any of their respective affiliates are 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 business combinations. After Closing,
directors or members of our management team, if any, who remain with us may be paid consulting or management fees from the Combined Company.
DLQ And DLQ Parent
DLQ’s
and DLQ Parent’s named executive officers for the year ended December 31, 2022, consisting of its principal executive officer
serving in such capacity as of December 31, 2022, were:
| · | Brent Suen, Chief Executive Officer of DLQ; |
DLQ’s
executive compensation program reflects its growth and development-oriented corporate culture. In this section, “named executive
officer” refers to DLQ’s principal executive officer and, if any, each of the two most highly compensated executive officers,
other than DLQ’s principal executive officer, who were serving as executive officers for the fiscal year ending December 31,
2022 and whose total salary and bonus exceed $100,000, as well as any additional individuals for whom disclosure would have been provided
except that the individual was not serving as an officer of DLQ at the end of the most recently completed fiscal year.
The
compensation of the named executive officer identified in the Summary Compensation Table below consists of a combination of base salary,
bonuses and long-term incentive compensation in the form of incentive stock options each executive officer was entitled to, based
upon their employment agreements with DLQ Parent. All compensation represented below indicates the compensation paid for their roles with
both DLQ and DLQ Parent, and as reported in DLQ Parent’s Form 10-K for the period ended December 31, 2022.
DLQ’s
named executive officers who are full-time employees, like all other full-time employees, are eligible to participate in DLQ’s
health and welfare benefit plans. As DLQ transitions, DLQ will evaluate its compensation values and philosophy and compensation plans
and arrangements as circumstances merit. At a minimum, DLQ expects to review executive compensation annually with input from a compensation
consultant. As part of this review process, DLQ expects the board of directors and its compensation committee to apply DLQ’s values
and philosophy, while considering the compensation levels needed to ensure DLQ’s executive compensation program remains competitive
with its peers. In connection with DLQ’s executive compensation program, its board of directors will also review whether DLQ is
meeting its retention objectives and the potential cost of replacing a key employee.
Summary Compensation
Table
The
following table sets forth, for the year ended December 31, 2022, all compensation paid, distributed or earned for services rendered
in all capacities by the named executive officer to DLQ and DLQ Parent:
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
Non-equity
incentive plan
compensation ($)
| | |
| | | |
| | |
| Name and Position | |
| Year | | |
| Salary ($) | | |
| Bonus ($) | | |
| Stock- based awards ($)(4) | | |
| Option- based awards ($) | | |
Annual incentive plans | |
| Long term incentive plans | | |
| All other compensation ($) | | |
| Total compensation ($) | |
| Brent Suen(1) | |
| 2022 | | |
| 0 | | |
| — | | |
| 0 | | |
| — | | |
— | |
| — | | |
| — | | |
| 0 | |
| Chief Executive Officer, Chief Financial Officer, Secretary | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| | | |
| | | |
| | |
The
following table sets forth, for the year ended December 31, 2021, all compensation paid, distributed or earned for services rendered
in all capacities by the named executive officer to DLQ and DLQ Parent:
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| Non-equity
incentive plan
compensation ($)
| | |
| | | |
| | |
| Name and Position | |
| Year | | |
| Salary ($) | | |
| Bonus ($) | | |
| Stock- based awards ($)(4) | | |
| Option- based awards ($) | | |
| Annual incentive plans | | |
| Long term incentive plans | | |
| All other compensation ($) | | |
| Total Compensation ($) | |
| Brent Suen | |
| 2021 | | |
| 216,000 | | |
| — | | |
| 48,880 | | |
| — | | |
| — | | |
| — | | |
| — | | |
| 264,880 | |
| Chief Executive Officer, Chief Financial Officer, Secretary | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Outstanding Equity
Awards at Fiscal Year End
There
are no shares of common stock underlying outstanding an equity incentive plan awards for the executive officers as of December 31,
2022.
Narrative to Summary
Compensation Table
Base
Salary
In
2022, the named executive officers received annual base salaries to compensate them for services rendered to DLQ and DLQ Parent. The base
salary payable to each named executive officer is intended to provide a fixed component of compensation reflecting the executive’s
skill set, experience, role and responsibilities.
Cash
Bonus
For
the year ended December 31, 2022, no cash bonus was paid to DLQ’s named executive officers. DLQ does not have a formal arrangement
with its named executive officers providing for annual cash bonus awards.
Equity-Based
Incentive Awards
DLQ
has not adopted an equity incentive plan and has not issued any stock options to its executive officer, director or consultant.
Benefits
and Perquisites
DLQ
Parent provides benefits to DLQ’s named executive officers on the same basis as provided to all of its employees, including medical,
vision and dental insurance; life insurance; short and long-term disability insurance.
Executive Employment
Agreements
Mr. Suen
does not have an employment agreement with DLQ. Prior to Closing, Mr. Suen was compensated for his services to DLQ indirectly
through DLQ Parent.
Outstanding Equity
Awards at Fiscal Year End
There
are no shares of common stock underlying outstanding an equity incentive plan
Director Compensation
Mr. Suen,
received no compensation for his services as a director of the Company. The compensation received by Mr. Suen, as an officer is presented
in “Executive Compensation — Summary Compensation Table.”
Combined Company
Following
Closing, we intend to develop an executive compensation program that is designed to align compensation with the Combined Company’s
business objectives and the creation of stockholder value, while enabling the Combined Company to attract, retain, incentivize and reward
individuals who contribute to the long-term success of the Combined Company. Decisions on the executive compensation program will
be made by the board of directors of the Combined Company and specifically through its compensation committee it expects to establish.
Executive Compensation
The
policies of the Combined Company with respect to the compensation of its executive officers and following the Business Combination will
be administered by its board of directors in consultation with the compensation committee that its board of directors expects to establish.
We expect that the compensation policies followed by the Combined Company will be designed to provide for compensation that is sufficient
to attract, motivate and retain executives of the Combined Company and to establish an appropriate relationship between executive compensation
and the creation of stockholder value.
In
addition to the guidance provided by its compensation committee, the Combined Company’s board of directors may utilize the services
of third parties from time to time in connection with the recruiting, hiring and determination of compensation awarded to executive employees.
Director Compensation
It
is anticipated that the compensation committee of the Combined Company’s board of directors will determine the annual compensation
to be paid to the members of the board of directors of the Combined Company upon completion of the Business Combination.
Emerging Growth Company
Status
As
an emerging growth company, DLQ will be exempt from certain requirements related to executive compensation, including the requirements
to hold a nonbinding advisory vote on executive compensation and to provide information relating to the ratio of total compensation of
DLQ’s chief executive officer to the median of the annual total compensation of all of DLQ’s employees, each as required by
the Investor Protection and Securities Reform Act of 2010, which is part of the Dodd-Frank Wall Street Reform and Consumer
Protection Act.
DIRECTORS AND EXECUTIVE
OFFICERS OF THE COMBINED COMPANY
AFTER THE BUSINESS COMBINATION
Information about
Directors Expected to be Appointed to the Board of Directors of the Combined Company
Upon
consummation of the Business Combination, the Combined Company’s board of directors will comprise five (5) members. Each of
our incumbent directors, with the exception of Nadine Watt, will resign from our Board upon Closing.
Executive Officers
and Directors
The
following persons are anticipated to be the executive officers and directors of the Combined Company, which will be renamed “Collective
Audience, Inc.” following the Business Combination:
| Name | |
Age | |
Position |
| Brent Suen | |
55 | |
Director Nominee; Chief Executive Officer |
| Robb Billy | |
49 | |
Chief Financial Officer |
| Chris Andrews | |
46 | |
Chief Operating Officer |
| Christopher Hardt | |
56 | |
Director Nominee |
| Nadine Watt | |
52 | |
Independent Director Nominee |
| Elisabeth DeMarse | |
68 | |
Independent Director Nominee |
| Denis Duncan | |
64 | |
Independent Director Nominee |
Brent Suen, Chief
Executive Officer, Director Nominee
Brent
Suen has agreed to serve as a director on our board and continue as Chief Executive Officer of the Combined Company. Previously served
as Logiq, Inc. (DLQ Parent) as Chief Executive Officer until September 1, 2020 and was re-appointed on January 7, 2022,
and has been President of Logiq since November 19, 2014, and a director of Logiq since November 19, 2014. Mr. Suen has
27 years of experience in the investment banking industry. He began his career in merger arbitrage at Bear Stearns in 1988, at the
age of 20, as the firms’ youngest hire. In 1993, he founded Axis Trading Corp., one of the first online platforms for stock
trading and subsequently sold it to a division of Softbank in 1996. In 1997, he co-founded Elevation Capital which invested in and
advised Silicon Valley based companies on IPO’s, mergers and acquisitions, strategic partnerships and fund raising. In 2003 Brent
moved to Hong Kong and China where he established Bay2Peak S.A. Bay2Peak has invested in and advised over fifty companies which
include Internet, software, renewable energy and life science companies. From 2006 to 2008 he also advised IRG TMT Asia Fund on private
and public investments. In 2012 Brent served as advisor to McLarty Group and Citibank Venture Capital on a sale/leaseback program valued
at $160 million leading to the eventual sale of the company for $630 million. For the past six years, Brent led the start-up and
management of Empirica S.A., a security/intelligence and frontier markets focused advisory firm operating in Asia, the Middle East, Africa
and Central Asia. Mr. Suen holds a BA degree in Marketing from the University of Arkansas at Little Rock. Based on Mr. Suen’s
work experience and education, the Board believes that he is qualified to serve as the Chief Executive officer and as a director of the
Combined Company.
Chris Andrews,
Chief Operating Officer
Mr. Andrews
has agreed to serve as the Combined Company’s Chief Operating Officers post-Closing. Mr. Andrews has served as the Chief Operating
Officer Logiq, Inc., a Delaware corporation (OTCQX:LGIQ) since January 2, 2023. Mr. Andrews previously served as the Chief Digital
Officer of MediaJel, Inc. from June 15, 2021 to December 31, 2022, a digital marketing company for businesses in regulated industries.
Prior to that, Mr. Andrews held the Chief Digital Officer role of Kubient, Inc. (Nasdaq: KBNT) from June 17, 2019 to May 31,
2021. From March 2017 to June 2019, he was employed as the Chief Technology Officer of Ogilvy CommonHealth Worldwide, a healthcare-focused marketing,
branding and advertising agency that is a subsidiary of WPP plc (NYSE:WPP), arguably the world’s largest advertising company. From
November 2006 to February 2017, he was the Chief Information Officer of Ogilvy CommonHealth Worldwide. Mr. Andrews holds a Bachelor
of Science and Masters of Business Administration from the New Jersey Institute of Technology. Based on Mr. Andrew’s work experience
and education, we believe that he is qualified to serve as the Chief Operating Officer of the Combined Company.
Robb Billy, Chief
Financial Officer
Mr. Billy
has agreed to serve as the Combined Company’s Chief Financial Officer after Closing. Mr. Billy has experience managing and
overseeing a business’ human resources, finance, information technology, real estate, insurance, risk management and aircraft management
departments. Since January 2020, Mr. Billy has served as a Partner and Chief Financial Officer of BattleBridge Labs. From November 2020
to January 2022, he served as the Chief Executive Officer of Vineyard Fruit & Vegetable Company. For 11 years, from
July 2008 to September 2019, Mr. Billy served as the Chief Financial Officer of Bob Mills Furniture. From July 1999
to June 2008, he served as the Director of Corporate Accounting at Associated Wholesale Grovers. Mr. Billy received a Bachelor’s
of Science in Accounting from the University of Tulsa. Based on Mr. Billy’s work experience and education, we believe that
he is qualified to serve as the Chief Financial officer of the Combined Company. Based on Mr. Billy’s work experience and education,
we believe that he is qualified to serve as the Chief Financial Officer of the Combined Company.
Christopher Hardt,
Director Nominee
Christopher
Hardt has agreed to serve as a director on the Combined Company’s board. Mr. Hardt is currently the Chief Financial Officer
and a director of the Company, has more than 30 years of Big 4 audit, compliance, reporting and international corporate advisory
experience. Mr. Hardt recently retired from PwC LLP where he was an audit partner since 2000. Since May 12, 2022, Mr. Hardt
has served as the Chief Financial Officer and Director of Abri SPAC 2, Inc., a special purpose acquisition company (“Abri
2”), (Nasdaq: ASPP). Mr. Hardt is also the Chief Financial Officer of Abri Advisors Ltd, in Bermuda, and Abri Advisors
(UK) Ltd. Mr. Hardt has been based previously in PwC’s offices in London, England, Lausanne, Switzerland and Tokyo, Japan in
addition to several offices in the United States. During his tenure at PwC, he was a lead partner on several large multinational
audit clients in the Consumer Markets, Technology, Media, Automotive, Banking and Insurance industries and has conducted business in over
40 countries. Mr. Hardt has also served as a leader in PwC’s SEC Services group in the firm’s National Office where he
was responsible for oversight of both foreign and domestic registrant client SEC filings including both debt and equity IPOs. In his prior
roles at PwC, Mr. Hardt has extensive experience with companies preparing to go public including the financial statement and internal
controls requirements of The Sarbanes-Oxley Act, interacting with the SEC and the financial reporting implications of executing growth
strategies involving mergers and acquisitions. Mr. Hardt also has many years of experience interacting with public company boards
of directors and their audit/finance committees. Mr. Hardt is an investor and adviser to Cavan & Co LLC, an early-stage American
made lifestyle apparel brand. Mr. Hardt holds a BA in Business Administration from Furman University and is a CPA licensed in Ohio,
Georgia and New Jersey. Mr. Hardt serves on the Board of Prime Living Partners Inc. and recently completed successive terms on both
the President’s Advisory Council of Furman University and the Parents Board at The Georgia Institute of Technology. Mr. Hardt
is well qualified to serve on our board due to his international expertise, experience with public company boards, involvement with the
IPO process at other companies and financial expertise having been an audit partner at PwC for over 20 years.
Nadine Watt, Independent
Director Nominee
Nadine
Watt has agreed to serve as a director on the Combined Company’s board. Since May 12, 2022, Ms. Watt has served as a Director
of Abri 2. Since December 2019, Ms. Watt has served as CEO of Watt Companies. She oversees the day-to-day activities and
strategic planning for all commercial investment activities including acquisitions, development, and asset management for the Watt Companies’
6 million-square-foot portfolio. Ms. Watt has served on the Board of Directors of Fisker, Inc. since June 2020. Fisker,
Inc. is an eco-friendly electric vehicles manufacturer. Ms. Watt served as President of Watt Companies from 2011 to 2019. In 2011,
she led a strategic reorganization of the company that moved the firm beyond traditional property management and leasing to a focus on
acquisitions and real estate development, as well as joint venture opportunities. Ms. Watt played a key role in launching Watt Companies’
acquisition division — Watt Investment Partners — that now actively invests $60 million in a variety
of property types across the Western United States., Ms. Watt is a member of the University of Southern California Board of Governors
and the Sol Price School of Public Policy Board of Councilors and serves on the Executive Committee of the Lusk Center for Real Estate
as well as the USC Associates Board of Directors. She was the first woman to be named Chair of the Los Angeles Business Council, a position
she still holds. She is a Board Member of Visionary Women and the City of Hope Los Angeles Real Estate & Construction Industries
Council. Ms. Watt received the Century City Citizen of the Year award in 2017 and the EY Entrepreneur of the Year award in 2018. A graduate
of Georgetown University School of Foreign Service, Ms. Watt also holds a Master of Arts degree from the School of Cinematic Arts at the
University of Southern California. We believe that Ms. Watt is qualified to serve as a director because of her extensive experience in
management and her prior service on a number of public company boards, which provides an important perspective on operations and corporate
governance matters.
Elisabeth DeMarse,
Independent Director Nominee
Elisabeth
DeMarse has agreed to serve as a director on our board. Ms. DeMarse is currently a Director of Trajectory Alpha Acquisition Corp.
(NASDAQ: TCOA). From 2012 to March 2016, Ms. DeMarse served as the President and Chief Executive Officer and chair of the
board of directors of TheStreet, Inc. Ms. DeMarse diversified The Street, Inc. from a B2C ad supported retail stock picking business
to B2B global M&A, data and news businesses. Ms. DeMarse spent 10 years as the Chief Marketing Officer for Bloomberg LP
working directly for the founder, Michael Bloomberg. Her Glassdoor Chief Executive Officer ranking is 100% and her companies have been
voted best Media Company to work for. She is currently a member of the board of directors of Kubient, Inc. and a member of the board of
directors and a chair of the audit committee of Clever Leaves Holdings Inc. (NASDAQ: CLVR). Ms. DeMarse previously served as
a member of the boards of directors of AppNexus (now part of AT&T), ZipRealty (ZIPR), InsWeb Corp (INSW), Internet Patents Corporation
(INTP), Edgar-Online (EDGR), Heska Corporation (HSKA), Incredimail (MAIL), Stockgroup (SWB), LiveDeal (LIVE), YP.com (YP), Nedsense
(NEDSE), All Star Directories and ProNoun. Ms. DeMarse received her MBA from Harvard Business School and her Bachelor of Arts from
Wellesley College. She is also a member of The Committee of 200. Based on Ms. DeMarse’s work experience and education, we believe
that he is qualified to serve as an independent director of the Combined Company.
Denis Duncan, Independent
Director Nominee.
Denis
Duncan has agreed to serve as a director on our board. Mr. Duncan recently retired from CapStar Financial Holding Inc.
(Nasdaq: CSTR) a $3.2 billion publicly traded financial services and bank holding company in Nashville, Tennessee, where he served
as the Chief Financial Officer from September 2020 until February 2022. Mr. Duncan had the responsibility of all financial,
accounting, corporate governance, treasury, tax, investor relations, financial reporting and capital planning/budgetary functions within
CapStar. During his time at CapStar, Mr. Duncan was involved with improving all aspects of CapStar’s operating performance
during which time CapStar’s market capitalization has doubled in value. Mr. Duncan was also board liaison to its audit committee
on all financial and governance matters. Mr. Duncan joined CapStar in 2020. Prior to joining CapStar, Mr. Duncan was a partner
at PwC for 27 years and retired from PwC in 2019. During his tenure at PwC, Mr. Duncan held various leadership positions in
the firm’s Financial Services industry sector and was most recently prior to his retirement the Southeast U.S. leader of the
firm’s Banking and Capital Markets sector. Mr. Duncan has significant experience serving and advising major international and
global money center banks, broker-dealers, asset management, private equity, hedge funds, insurance and real estate companies. Mr. Duncan
is well versed in matters of corporate governance, risk management, board reporting, finance, corporate reporting, SEC, PCAOB and Sarbanes
Oxley section 404 regulatory and compliance matters. Mr. Duncan is a certified public accountant licensed in the state of Tennessee.
Mr. Duncan is currently a Trustee at Oglethorpe University and is a member of the board at the Atlanta Rotary Club. Mr. Duncan
holds a Bachelor of Science degree in Accounting from Lipscomb University. We believe that Mr. Duncan is qualified to serve on the
board of directors due to his extensive corporate governance, risk management, corporate compliance and capital markets experience and
his experience serving on the leadership team and board of directors of another public company.
Family Relationships
There
are no family relationships between the Combined Company’s Board of Directors and any of its executive officers.
Composition of the
Board of Directors
The
Combined Company will have one class of directors serving for a term expiring at the next annual meeting of stockholders.
Controlled Company
Exemption
After
Closing, Logiq, Inc., because the public stockholders redeemed 4,481,548 (or 78%) of their public shares of Abri Common Stock in connection
with the Special Meeting held on December 9, 2022, DLQ Parent would beneficially own a majority of the voting power of all outstanding
shares of the Combined Company’s common stock, or 59.3% of the Combined Company, without taking into account the redemption of any
additional shares of Common Stock by the public stockholders or the issuance of any Earnout Shares, which include up to 1,000,000 Earnout
Shares to be distributed to the Sponsor and up to 2,000,000 Earnout Shares to be distributed to DLQ Management, if certain milestones
are achieved after the business combination. As a result, the Combined Company will be a “controlled company” within the meaning
of Nasdaq’s corporate governance standards. Under these corporate governance standards, a company of which more than fifty percent
(50%) of the voting power is held by an individual, group or another company is a “controlled company” and may elect not to
comply with certain corporate governance standards, including the requirements to have: (i) a board of directors composed of a majority
of independent directors; (ii) compensation of its executive officers determined by a majority of the independent directors or a
compensation committee composed solely of independent directors; (iii) a compensation committee charter which, among other things,
provides the compensation committee with the authority and funding to retain compensation consultants and other advisors; and (iv) director
nominees selected, or recommended for the Combined Company’s board of directors’ selection, either by a majority of the independent
directors or a nominating committee composed solely of independent directors. Because the Combined Company will be deemed a “control
company” within the meaning of the Nasdaq listing rules, it will be permitted to elect to not comply with certain corporate governance
requirements, including the requirement that a majority of the board of directors consist of independent directors, the requirement that
the nominating committee is composed entirely of independent directors and the requirement that the compensation committee is composed
entirely of independent directors. majority of these directors will be independent directors. As a result of DLQ Parent’s “controlled
company” status, and if the Combined Company elects to rely on the exemptions afforded to it as a “controlled company,”
stockholders may be afforded less protection under the Nasdaq listing rules and SEC regulations than other public companies. For at least
some period following the Merger, the Combined Company may utilize these exemptions since the Combined Company has not yet made a determination
with respect to the independence of all directors. Pending such determination, you may not have the same protections afforded to stockholders
of companies that are subject to all of these corporate governance requirements. After Closing, all members of the Combined Company’s
Audit Committee have to be independent directors. For more information on the independence of the Combined Company’s directors,
see “Directors and Executive Officers of the Combined Company After the Business Combination — Director Independence.”
For more information on the Combined Company’s Audit Committee, see “Directors and Executive Officers of the Combined Company
After the Business Combination — Committees of the Board of Directors — Audit Committee.” If
the Combined Company ceases to be a “controlled company” and its shares continue to be listed on Nasdaq, the Combined Company
will be required to comply with Nasdaq’s corporate governance listing standards. Depending on the Combined Company’s board
of directors’ determination of the independence with respect to its then-current directors, the Combined Company may be required
to add additional directors to the Combined Company’s board of directors in order to achieve such compliance within the applicable
transition periods.
Director Independence
Nasdaq
listing rules require that a majority of the board of directors of a company listed on Nasdaq 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. The Combined Company’s board of directors has determined
that, upon Closing, each of Nadine Watt, Elisabeth DeMarse and Denis Duncan will be an independent director under the Nasdaq listing rules
and Rule 10A-3 of the Exchange Act. In making these determinations, the Combined Company’s board of directors considered
the current and prior relationships that each non-employee director has with DLQ and will have with the Combined Company and all
other facts and circumstances the Combined Company’s board of directors deemed relevant in determining independence, including the
beneficial ownership of our Common Stock by each non-employee director, and the transactions involving them described in the section
entitled “Certain Relationships and Related Transactions.”
Committees of the
Board of Directors
The
standing committees of Combined Company’s board of directors will consist of an Audit Committee, a Compensation Committee, a Nominating
and Corporate Governance Committee, and a Technology Sub-Committee. The expected composition of each committee following the Business
Combination is set forth below.
Audit Committee
Our
Audit Committee has been established in accordance with Section 3(a)(58)(A) of the Exchange Act and following the Business
Combination will consist of Nadine Watt, Elisabeth DeMarse and Denis Duncan, each of whom are independent directors and are “financially
literate” as defined under the Nasdaq listing standards. Denis Duncan will serve as chairman of the Audit Committee. Our Board has
determined that Mr. Duncan qualifies as an “audit committee financial expert,” as defined under rules and regulations
of the SEC.
The
audit committee’s duties are specified in our Audit Committee Charter.
Compensation Committee
Following
the Business Combination, our Compensation Committee will consist of Nadine Watt, Elisabeth DeMarse and Denis Duncan, each of whom is
an independent director. Elisabeth DeMarse will serve as chairman of the Compensation Committee. The functions of the Compensation Committee
will be set forth in a Compensation Committee Charter.
Nominating Committee
Following
the Business Combination, our Nominating Committee will consist of Nadine Watt and Denis Duncan, each of whom is an independent director
under Nasdaq’s listing standards. Ms. Watt will serve as the chair of the Nominating Committee. The Nominating Committee is responsible
for overseeing the selection of persons to be nominated to serve on the Board. The Nominating Committee considers persons identified by
its members, management, stockholders, investment bankers and others.
The
guidelines for selecting nominees, will be specified in the Nominating Committee Charter.
Code of Business Conduct
and Ethics
Upon
Closing, we will adopt a new Code of Business Conduct and Ethics for our directors, officers, employees and certain affiliates following
the Business Combination in accordance with applicable federal securities laws, a copy of which will be available on the Combined Company’s
website at www.DLQ.com. The Combined Company will make a printed copy of the Code of Business Conduct and Ethics available
to any stockholder who so requests. Following the Business Combination, requests for a printed copy may be directed to DLQ, Inc.: Attention:
Brent Suen.
If
we amend or grant a waiver of one or more of the provisions of our Code of Business Conduct and Ethics, we intend to satisfy the requirements
under Item 5.05 of Form 8-K regarding the disclosure of amendments to or waivers from provisions of our Code of Business
Conduct and Ethics that apply to our principal executive officer, principal financial officer and principal accounting officer by posting
the required information on the Combined Company’s website at www.DLQ.com. The information on this website is not part
of this proxy statement.
Officer and Director
Compensation Following the Business Combination
After
Closing, the board of directors of the Combined Company may adopt a new equity incentive plan that will have such number of shares available
for issuance equal to ten percent (10%) of the Abri common stock issued and outstanding immediately after the Closing. No other terms
or characteristics have been decided. Our board of directors may adopt a nonemployee director compensation program (a “Director
Compensation Policy”) after Closing. The Director Compensation Policy would be designed to align compensation with the Combined
Company’s business objectives and the creation of stockholder value, while enabling the Combined Company to attract, retain, incentivize
and reward non-employee directors who contribute to the long-term success of the Combined Company.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT
The following
table sets forth information regarding the beneficial ownership of shares of our Common Stock as of September 25, 2023 pre-Business Combination
and immediately after Closing by:
| · | each person or “group” (as such term is used in Section 13(d)(3) of
the Exchange Act) known by Abri to be the beneficial owner of more than 5% of shares of our Common Stock as of September 25, 2023
(pre-Business Combination) or of shares of our Common Stock upon Closing; |
| · | each of Abri’s executive officers and directors; |
| · | each person who will become an executive officer or director
of the Combined Company upon Closing; |
| · | all of our current executive officers and directors as a group;
and |
| · | all executive officers and directors of the Combined Company
as a group upon Closing. |
As of
the Record Date, Abri had 2,410,226 shares of Common Stock issued and outstanding.
Beneficial
ownership is determined in accordance with SEC rules and includes voting or investment power with respect to securities. Except as indicated
by the footnotes below, Abri believes, based on the information furnished to it, that the persons and entities named in the table below
have, or will have immediately after Closing, sole voting and investment power with respect to all shares of our Common Stock that they
beneficially own, subject to applicable community property laws. Any shares of our Common Stock subject to options or Warrants exercisable
within 60 days from Closing are deemed to be outstanding and beneficially owned by the persons holding those options or Warrants
for the purpose of computing the number of shares beneficially owned and the percentage ownership of that person. They are not, however,
deemed to be outstanding and beneficially owned for the purpose of computing the percentage ownership of any other person.
Subject
to the paragraph above, percentage ownership of outstanding shares is based on 2,410,226 shares of our Common Stock to be outstanding
upon consummation of the Business Combination, but does not take into account any Warrants, options or other convertible securities of
DLQ issued and outstanding as of the date hereof. If the actual facts are different than these assumptions (which they are likely to be),
the percentage ownership retained by Abri’s existing stockholders in Abri will be different.
The
expected beneficial ownership of Common Stock post-Business Combination under the header “Post-Business Combination — Assuming
No Redemption” assumes none of the shares of Common Stock having been redeemed.
The
expected beneficial ownership of Common Stock post-Business Combination under the header “Post-Business Combination — Assuming
Maximum Redemption” assumes 682,148 shares of Common Stock having been redeemed.
| | |
Pre-Business Combination | | |
Post-Business Combination | |
| | |
Number of
Shares | | |
Assuming No
Redemption | | |
Assuming Maximum
Redemption | |
Name and Address of
Beneficial Owner | |
Number of
Shares
Beneficially
Owned | | |
% of
Class | | |
Number of
Shares | | |
% of
Class** | | |
Number of
Shares | | |
% of
Class** | |
| Jeffrey Tirman(1)(2) | |
| 1,728,078 | | |
| 12.5 | % | |
| 1,728,078 | | |
| 12.8 | % | |
| 1,728,078 | | |
| 13.1 | % |
| Abri Ventures I, LLC(2) | |
| 1,728,078 | | |
| 12.5 | % | |
| 1,728,078 | | |
| 12.8 | % | |
| 1,728,078 | | |
| 13.1 | % |
| All directors and executive officers prior to the Business Combination as a group (5 individuals) | |
| 1,728,078 | | |
| 12.5 | % | |
| 1,728,078 | | |
| 12.8 | % | |
| 1,728,078 | | |
| 13.1 | % |
| Expected Five Percent Holders of the Combined Company Immediately After Closing | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Logiq, Inc.(3) | |
| 6,038,000 | | |
| 43.6 | % | |
| 6,038,000 | | |
| 44.7 | | |
| 6,038,000 | | |
| 45.9 | % |
| Expected Directors and Executive Officers of the Combined Company Immediately After Closing | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Christopher Hardt | |
| — | | |
| — | | |
| | | |
| | | |
| | | |
| | |
| Brent Suen | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Nadine Watt | |
| — | | |
| — | | |
| | | |
| | | |
| | | |
| | |
| Elisabeth DeMarse | |
| — | | |
| — | | |
| | | |
| | | |
| | | |
| | |
| Denis Duncan | |
| — | | |
| — | | |
| | | |
| | | |
| | | |
| | |
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| All directors and executive officers upon Closing as a group (10 individuals) | |
| 6,038,000 | | |
| 43.6 | % | |
| 6,038,000 | | |
| 44.7 | % | |
| 6,038,000 | | |
| 45.0 | % |
| ** | Represents the combined voting power with respect to all shares
of Common Stock post-Closing, see “Description of Abri’s Securities — Common Stock.” |
| (1) | The business address of each of the individuals is c/o Abri
Ventures I, LLC, 9663 Santa Monica Blvd., No. 1091, Beverly Hills, CA 90210. |
| (2) | Abri Ventures I, LLC, our Sponsor, is the record holder
of the shares reported herein. Abri Advisors Ltd. is the managing member of our Sponsor. Jeffrey Tirman, our Chairman and Chief Executive
Officer, is the managing executive director of Abri Advisors Ltd., and as such has voting and dispositive power over the shares owned
by Abri Ventures I, LLC. By virtue of this relationship, Mr. Tirman may be deemed to have beneficial ownership of the
securities held of record by our Sponsor. |
| (3) | The business address of Logiq, Inc. is 85 Broad Street 16-079,
New York, New York, 10004. |
DESCRIPTION OF ABRI’S SECURITIES
General
Pursuant
to Abri’s Certificate of Incorporation, the authorized stock consists of 100,000,000 shares of Common Stock, par value $0.0001,
and 1,000,000 shares of preferred stock, par value $0.0001. As of the date of this proxy statement 7,461,998 shares of Common
Stock are issued and outstanding. No preferred shares are issued or outstanding. The following description summarizes 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, bylaws, our warrant agreement, and to the applicable provisions of Delaware law.
Units
Each
Unit consists of one share of common stock and one Warrant. Each Warrant entitles the registered holder to purchase one share of common
stock at a price of $11.50 per share and shall expire five years after the completion of an initial business combination, or earlier
upon redemption. Fractional shares will either be rounded down to the nearest whole share or otherwise addressed in accordance with the
applicable provisions of Delaware Law. On September 3, 2021, the holders of the Units were able to elect to separately
trade the shares of Common Stock and Warrants included in the Units.
Common Stock
Abri
stockholders of record 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 the initial business combination, our Sponsor, as well as all of our officers and directors, have agreed to vote
their respective shares of Common Stock owned by them immediately prior to this offering and any shares purchased in this offering or
following this offering in the open market, including any shares included in shares of Common Stock acquired in this offering or in the
aftermarket, in favor of the proposed business combination.
Unless
the Amendment to the Current Charter is approved, we will only consummate our initial business combination if we have net tangible assets
of at least $5,000,001 or Logiq is otherwise exempt from the provisions of Rule 419 promulgated under the Securities Act of 1933, as amended,
either immediately prior to or upon such consummation and, solely if a vote is held to approve a business combination, a majority of the
outstanding shares of Common Stock voted are voted in favor of the business combination. If the Amendment to the Current Charter is approved,
this requirement need not be met.
The
Board is divided into three classes, each of which will generally serve for a term of three years with only one class of directors
being elected in each year. There is no cumulative voting with respect to the election of directors, with the result that the holders
of more than 50% of the shares eligible to vote for the election of directors can elect all of the directors.
Pursuant
to Abri’s Certificate of Incorporation, as amended on December 9, 2022, if they do not consummate an initial business combination
by August 12, 2023, Abri’s corporate existence will cease except for the purposes of winding up our affairs and liquidating.
If we are forced to liquidate prior to an initial business combination, our public stockholders are entitled to share ratably in the Trust
Account, based on the amount then held in the Trust Account. Abri’s Sponsor, officers and directors have agreed to waive their rights
to participate in any liquidation distribution from the Trust Account occurring upon our failure to consummate an initial business combination
with respect to the founder’s Common Stock and Private shares of Common Stock. Our Sponsor, officers and directors will therefore
not participate in any liquidation distribution from the Trust Account with respect to such shares or shares of Common Stock. They will,
however, participate in any liquidation distribution from the Trust Account with respect to any shares of Common Stock acquired in, or
following, the IPO.
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 public stockholders have the right to sell their shares of Common Stock to us in a tender offer
or have their shares of Common Stock converted to cash equal to their pro rata share of the Trust Account in connection with the consummation
of our initial business combination. Public stockholders who redeem their shares of Common Stock into their share of the Trust Account
still have the right to exercise any Warrants they still hold outside of such shares of Common Stock but will forfeit, without the receipt
of any additional consideration, the portion of the Warrant included in the shares of Common Stock. Accordingly, an investor may have
a disincentive to exercise redemption rights due to the loss of such portion of the Warrants.
Preferred Stock
There
are no shares of preferred stock outstanding. Our Certificate of Incorporation as of the date of this proxy statement authorizes the issuance
of 1,000,000 shares of preferred stock with such designation, rights and preferences as may be determined from time to time by the
Board. Accordingly, the Board is empowered, without stockholder approval, to issue preferred stock with dividend, liquidation, conversion,
voting or other rights which could adversely affect the voting power or other rights of the holders of Common Stock. However, the underwriting
agreement prohibits us, prior to a business combination, from issuing preferred stock which participates in any manner in the proceeds
of the Trust Account, or which votes as a class with the Common Stock on a business combination. We may issue some or all of the preferred
stock to effect a 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 cannot assure you that we will
not do so in the future.
Changes in Capital
Stock as a result of the Amended Charter
The
Amended Charter will authorize the issuance of up to 300,000,000 shares, par value $0.0001 per share, consisting of: 200,000,000 shares
of Common Stock; and 100,000,000 shares of preferred stock.
Authorized Capital Stock
|
| The Current Charter authorizes the issuance of up to 101,000,000 shares, par value $0.0001 per share, consisting of: 100,000,000 shares of Common Stock; and 1,000,000 shares of preferred stock. |
|
The Amended Charter will authorize the issuance
of up to 300,000,000 shares, par value $0.0001 per share, consisting of:
200,000,000 shares of Common Stock; and
100,000,000 shares of preferred stock. |
Voting
|
| The Current Charter provides that, except as otherwise required by law or as otherwise provided in any preferred stock designation, the holders of the Common Stock shall exclusively possess all voting power and each share of Common Stock shall have one vote. |
|
Each share of Common Stock shall entitle the holder thereof to one (1) vote on each matter submitted to a vote at any meeting of stockholders. |
Rights of Preferred Stock
|
| The Current Charter authorizes the designation of a Series of preferred stock, but does not itself designate any Series of preferred stock. |
|
The Amended Charter will permit the board of directors of the Combined Company to issue preferred stock in one or more series, and in connection with the creation of any such series, by resolution or resolutions providing for the issue of the shares thereof, to determine and fix such voting powers, if any, and such designations, powers, preferences and relative participating, optional, special or other rights, if any, and any qualifications, limitations or restrictions thereof as shall be stated and expressed in such resolutions, as permitted by the DGCL. |
Redeemable Warrants
As of
September 25, 2023, there are 6,028,518 Warrants outstanding. Each Warrant entitles the registered holder to purchase one share of common
stock at a price of $11.50 per share, subject to adjustment as discussed below, at any time commencing on the later of the completion
of our initial business combination and one year from the consummation of this offering. Except as set forth below, no 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. Notwithstanding the foregoing, if a registration statement
covering the shares of common stock issuable upon exercise of the Warrants is not effective within 90 days from 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 from registration provided by Section 3(a)(9) of the Securities Act provided that such exemption is available. If
an exemption from registration is not available, holders will not be able to exercise their warrants on a cashless basis. The Warrants
will expire five years after the completion of an initial business combination at 5:00 p.m., Eastern Standard Time.
In
addition, 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 an issue price or effective issue price of less than $9.50 per share (with such
issue price or effective issue price to be determined in good faith by our board of directors), (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, and (z) the volume weighted average trading price of our shares of 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 (such price,
the “Market Price”) is below $9.50 per share, the exercise price of the Warrants will be adjusted (to the nearest cent)
to be equal to 115% of the Market Price, and the $16.50 per share redemption trigger price described below will be adjusted (to the nearest
cent) to be equal to 165% of the Market Price.
We
may call the Warrants for redemption, in whole and not in part, at a price of $0.01 per warrant:
| · | at any time while the Warrants are exercisable, |
| · | upon not less than 30 days’ prior written notice
of redemption to each warrant holder, |
| · | if, and only if, the reported last sale price of the shares
of common stock equals or exceeds $16.50 per share, for any 20 trading days within a 30 trading day period ending
on the third business day prior to the notice of redemption to warrant holders (the “Force-Call Provision”), 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. |
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 which 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, however, such redemption may occur at a time when the Warrants are “out-of-the-money,”
in which case you would lose any potential embedded value from a subsequent increase in the value of Common Stock had your Warrants remained
outstanding. Historical trading prices for our Common Stock have not exceeded the $16.50 per share threshold at which the Public Warrants
would become redeemable. However, this could occur in connection with or after Closing.
In
the event we determined to redeem our Public Warrants, holders of redeemable Public Warrants will be notified of such redemption as described
in our warrant agreement between Continental Stock Transfer & Trust Company, as warrant agent, and us, dated August 9, 2021
(the “Warrant Agreement”). Specifically, in the event that we elect to redeem all of the redeemable Warrants
as described above, we will fix a date for the redemption (the “Redemption Date”). Notice of redemption will
be mailed by first class mail, postage prepaid, by us not less than 30 days prior to the Redemption Date to the registered holders
of the redeemable Warrants to be redeemed at their last addresses as they appear on the Warrant Register. Any notice mailed in the manner
provided in the Warrant Agreement will be conclusively presumed to have been duly given whether or not the registered holder received
such notice. In addition, beneficial owners of the redeemable Warrants will be notified of such redemption via posting of the redemption
notice to DTC.
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 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 volume weighted average
price of the shares of 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 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.
If
our management takes advantage of this option, the notice of redemption will contain the information necessary to calculate the number
of Common Stock to be received upon exercise of the Warrants, including the “fair market value” in such case. Requiring a
cashless exercise in this manner will reduce the number of Common Stock to be issued and thereby lessen the dilutive effect of a warrant
redemption. We believe this feature is an attractive option to us if we do not need the cash from the exercise of the Warrants after our
initial business combination. If we call our Warrants for redemption and our management does not take advantage of this option, the holders
of the Private Warrants and their permitted transferees would still be entitled to exercise their Private Warrants for cash or on a cashless
basis using the same formula described above that other warrant holders would have been required to use had all warrant holders been required
to exercise their warrants on a cashless basis.
The
Warrants were issued in registered form under the Warrant Agreement which 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 capitalizations, extraordinary dividend or our 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.
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 warrants will be exercisable 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 shares of 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 (and his, her
or its affiliates) would not be able to exercise their warrants to the extent that, after giving effect to such exercise, such holder
(and his, her or its affiliates) would beneficially own in excess of 9.99% of the shares of common stock issued and outstanding. Notwithstanding
the foregoing, any person who acquires a warrant with the purpose or effect of changing or influencing the control of our company, or
in connection with or as a participant in any transaction having such purpose or effect, immediately upon such acquisition will be deemed
to be the beneficial owner of the underlying shares of common stock and not be able to take advantage of this provision.
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 (as a result of a subsequent share capitalizations payable in shares of common stock, or by a split up
of the shares of common stock or other similar event), we will, upon exercise, round up or down to the nearest whole number the number
of shares of common stock to be issued to the Warrant holder.
We
have agreed that, subject to applicable law, any action, proceeding or claim against us arising out of or relating in any way to the warrant
agreement 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 we irrevocably submit to such jurisdiction, which jurisdiction will be the exclusive forum for any such
action, proceeding or claim. See “Risk Factors — Our warrant agreement has designated 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.” This provision applies to claims under the Securities Act but
does not apply to claims under the Exchange Act or any claim for which the federal district courts of the United States of America
are the sole and exclusive forum.
Private Units
Except
as described below, the Private Units have terms and provisions that are identical to those the Units issued in the IPO. The
Private Units (including their component securities and the share of Common Stock issuable upon exercise of the Private Warrants
included in the Private Units) will not be transferable, assignable or salable until 30 days after the completion of our initial
business combination (except pursuant to limited exceptions as described under “Principal Stockholders — Transfers
of Founder Shares and Private Units,” to our officers and directors and other persons or entities affiliated with the initial purchasers
of the Private Units). The Private Warrants so long as they are held by our Sponsor or its permitted transferees a) will not be redeemable
by us and b) will be exercisable on a cashless basis. If the Private Warrants are held by holders other than our Sponsor or its permitted
transferees, the Private Warrants will be redeemable by us in all redemption scenarios and exercisable by the holders on the same basis
as the Warrants included in the Units sold in the IPO. At Closing, the Private Warrants will be the same as the Public Warrants.
We
expect to have policies in place that restrict insiders from selling our securities except during specific periods of time. Even during
such periods of time when insiders will be permitted to sell our securities, an insider cannot trade in our securities if he or she is
in possession of material non-public information. Accordingly, unlike public stockholders who could exercise their warrants and sell
the common stock received upon such exercise freely in the open market in order to recoup the cost of such exercise, the insiders could
be significantly restricted from selling such securities. As a result, we believe that allowing the holders to exercise such warrants
on a cashless basis is appropriate.
On
March 8, 2022, Abri issued the First Working Capital Note to the Sponsor where the Sponsor agreed to loan us an aggregate principal
amount of $300,000. On April 4, 2022, Abri issued the Second Working Capital Note to the Sponsor where the Sponsor agreed to loan
us an aggregate principal amount of $500,000. On August 26, 2022, Abri issued the Third Convertible Promissory note for an aggregate
principal amount of $300,000 to the Sponsor. On November 21, 2022, Abri issued the Fourth Convertible Promissory Note for an aggregate
principal amount of $150,000 to the Sponsor. On January 17, 2023, Abri issued the Fifth Convertible Promissory Note for an aggregate
principal amount of $200,000 to the Sponsor. On February 10, 2023, Abri issued a fifth convertible promissory note for an aggregate
principal amount of $150,000 to the Sponsor. The Working Capital Notes was issued to fund working capital of the Company. The Working
Capital Notes are non-interest bearing and all outstanding amounts under the Working Capital Notes will be due on the date on which
we consummate our initial business combination, the Maturity Date. If a business combination is not consummated, and there are insufficient
funds to repay the Working Capital Notes, the unpaid amounts would be forgiven. All or a portion of the amounts outstanding under the
Working Capital Notes may be converted on the Maturity Date into units at a price of $10.00 per unit at the option of the Sponsor. The
units would be identical to the Company’s outstanding Private Units that were issued to the Sponsor in the Private Placement.
The Working Capital Notes contain customary events of default, including, among others, those relating to the Company’s failure
to make a payment of principal when due and to perform any other obligations that is not timely cured after written notice of such default
from the Sponsor.
In
order to meet our working capital needs until we consummate the Business Combination, in addition to the Working Capital Note, we may,
but are not obligated to, have funds advanced to us, from time to time or at any time, in whatever amount we deem reasonable in the sole
discretion of our officers and directors. Each such loan would be evidenced by a promissory note. The notes would either be paid upon
consummation of our initial business combination, without interest, or, at the lender’s discretion, up to $1,500,000 of the notes
may be converted upon consummation of our business combination into additional units at a price of $10.00 per unit. These units would
be identical to the private units.
Dividends
We
have not paid any cash dividends on our common stock to date and do not intend to pay cash dividends prior to the completion of a 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 a business combination. The payment of any cash dividends subsequent to a
business combination will be within the discretion of our board of directors at such time. In addition, our board of directors is
not currently contemplating and does not anticipate declaring any stock dividends in the foreseeable future. Further, if we incur any
indebtedness, our ability to declare dividends may be limited by restrictive covenants we may agree to in connection therewith.
Authorized Capital
Stock of the Combined Company
The
Amended Charter will authorize the issuance of up to 300,000,000 shares, par value $0.0001 per share, consisting of: 200,000,000 shares
of Common Stock; and 100,000,000 shares of preferred stock. The Amended Charter will permit the board of directors of the Combined
Company to issue preferred stock in one or more series, and in connection with the creation of any such series, by resolution or resolutions
providing for the issue of the shares thereof, to determine and fix such voting powers, if any, and such designations, powers, preferences
and relative participating, optional, special or other rights, if any, and any qualifications, limitations or restrictions thereof as
shall be stated and expressed in such resolutions, as permitted by the DGCL.
Exclusive Forum Provision
Except
with the consent of the Combined Company to the selection of an alternative forum, the Court of Chancery of the State of Delaware shall
be the sole and exclusive forum for certain stockholder litigation, except for any action as to which the Chancery Court determines that
there is an indispensable party not subject to the jurisdiction of such court and to which jurisdiction such party does not consent within
10 days of such determination, which is vested in the exclusive jurisdiction of a court or forum other than the Chancery Court or
for which the Chancery Court does not have subject matter jurisdiction, or any action arising under the Securities Act as to which the
Chancery Court and the federal district court for the District of Delaware shall have concurrent jurisdiction. The preceding exclusive
forum provision does not apply to suits brought to enforce any liability or duty created by the Exchange Act or any other claim for
which the federal courts have exclusive jurisdiction.
Logiq’s Transfer
Agent
The
transfer agent and registrar for Logiq Common Stock is Nevada Agency and Trust Company. Its address is 50 West Liberty Street, Reno, Nevada
89501.
Abri’ Transfer
Agent and Warrant Agent
The
transfer agent for Abri’s securities and warrant agent for Abri’s Warrants is Continental Stock Transfer & Trust
Company, 1 State Street, New York, New York 10004.
Listing of Abri Securities
The
Units, shares of Common Stock, and Warrants are currently listed on the Nasdaq Stock Market, under the symbols “ASPAU,” “ASPA,”
and “ASPAW,” respectively. The Units, shares of Common Stock and Warrants commenced trading on the Nasdaq Stock Market separately
on September 03, 2021.
Certain Anti-Takeover
Provisions of Delaware Law and Abri’s Amended and Restated Certificate of Incorporation and By-Laws
Staggered
board of directors
Abri’s
Certificate of Incorporation provides that the Abri Board shall be classified into three classes of directors of approximately equal size.
As a result, in most circumstances, a person can gain control of our Abri Board only by successfully engaging in a proxy contest at two
or more annual meetings.
Special
meeting of stockholders
Abri’s
bylaws provide that special meetings of our stockholders may be called only by a majority vote of the Abri Board, by our president or
by its chairman or by its secretary at the request in writing of stockholders owning a majority of Abri’s issued and outstanding
capital stock entitled to vote.
Advance
notice requirements for stockholder proposals and director nominations
Abri’s
bylaws provide that stockholders seeking to bring business before its annual meeting of stockholders, or to nominate candidates for election
as directors at its 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 Abri’s principal executive offices not later than the close of business on the 60th day
nor earlier than the close of business on the 90th day prior to the scheduled date of the annual meeting of stockholders.
In the event that less than 70 days’ notice or prior public disclosure of the date of the annual meeting of stockholders is
given, a stockholder’s notice shall be timely if delivered to Abri principal executive offices not later than the 10th day
following the day on which public announcement of the date of its annual meeting of stockholders is first made or sent by Abri. Abri’s
bylaws also specify certain requirements as to the form and content of a stockholders’ meeting. These provisions may preclude Abri’s
stockholders from bringing matters before its annual meeting of stockholders or from making nominations for directors at its 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 Selection
Abri’s
Certificate of Incorporation requires, to the fullest extent permitted by law, that derivative actions brought in its name, actions against
directors, officers and employees for breach of fiduciary duty and certain other actions may be brought only in the Court of Chancery
in the State of Delaware, except any action (A) as to which the Court of Chancery in the State of Delaware determines that there
is an indispensable party not subject to the jurisdiction of the Court of Chancery (and the indispensable party does not consent to the
personal jurisdiction of the Court of Chancery within ten days following such determination), (B) which is vested in the exclusive
jurisdiction of a court or forum other than the Court of Chancery or (C) for which the Court of Chancery does not have subject matter
jurisdiction. If an action is brought outside of Delaware, the stockholder bringing the suit will be deemed to have consented to service
of process on such stockholder’s counsel. Although we believe this provision benefits us by providing increased consistency in the
application of 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.
Abri’s
Certificate of Incorporation provides that the exclusive forum provision will be applicable to the fullest extent permitted by applicable
law, subject to certain exceptions. 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. As a result, the exclusive
forum provision does not apply to suits brought to enforce any duty or liability created by the Exchange Act or any other claim for
which the federal courts have exclusive jurisdiction. In addition, Abri’s Certificate of Incorporation provides that, unless we
consent in writing to the selection of an alternative forum, the federal district courts of the United States of America shall, to
the fullest extent permitted by law, be the exclusive forum for the resolution of any complaint asserting a cause of action arising under
the Securities Act of 1933, as amended, or the rules and regulations promulgated thereunder. However, 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.
COMPARISON OF STOCKHOLDERS’ RIGHTS
Comparison of Stockholders’ Rights
If the Charter Amendment Proposal
is approved by the Abri stockholders the Amended Charter will amend and replace the Current Charter. The following table sets forth a
summary of the principal proposed changes and the differences between Abri’s stockholders’ rights under the Current Charter
and under the Amended Charter. This summary is qualified in its entirety by reference to the complete text of the Amended Charter, a copy
of which is attached to this proxy statement as Annex B and the complete text of the Amended Bylaws, a copy of which is attached
to this proxy statement as Annex C. We urge you to read the Amended Charter in its entirety for a complete description
of the rights and preferences.
| Abri |
|
Combined Company |
Name Change
|
| Abri’s current name is Abri SPAC 1, Inc. |
|
Upon Closing, Abri’s name will be changed to Collective Audience, Inc. |
Purpose |
| The purpose of the Current Charter is to engage in any lawful act or activity for which corporations may be organized under the DGCL. |
|
The Amended Charter will provide that the purpose of the Combined Company is to engage in any lawful act or activity for which corporations may be organized under the DGCL. |
| Authorized Capital Stock |
| The Current Charter authorizes the issuance of up to 101,000,000 shares, par value $0.0001 per share, consisting of: 100,000,000 shares of Abri Common Stock; and 1,000,000 shares of Abri preferred stock. |
|
The Amended Charter will authorize the issuance of
up to 300,000,000 shares, par value $0.0001 per share, consisting of:
200,000,000 shares of Common Stock; and
100,000,000 shares of preferred stock. |
| Voting |
| The Current Charter provides that, except as otherwise required by law or as otherwise provided in any preferred stock designation, the holders of the Abri Common Stock shall exclusively possess all voting power and each share of Abri Common Stock shall have one vote. |
|
Each share of Common Stock shall entitle the holder thereof to one (1) vote on each matter submitted to a vote at any meeting of stockholders. |
| Rights of Preferred Stock |
| The Current Charter authorizes the designation of a Series of preferred stock, but does not itself designate any Series of preferred stock. |
|
The Amended Charter will permit the board of directors of the Combined Company to issue preferred stock in one or more series, and in connection with the creation of any such series, by resolution or resolutions providing for the issue of the shares thereof, to determine and fix such voting powers, if any, and such designations, powers, preferences and relative participating, optional, special or other rights, if any, and any qualifications, limitations or restrictions thereof as shall be stated and expressed in such resolutions, as permitted by the DGCL. |
| Abri |
|
Combined Company |
| Directors |
|
The current bylaws of Abri provide that the authorized
number of the board of directors of the corporation shall consist of not less than one (1) directors. The number of directors may
be changed from time to time by resolution of the board of the directors.
The Current Charter provides that the Abri Board shall be divided into
three classes of directors of approximately equal size, each of which will generally serve for a term of three years with only one
class of directors being elected in each year. There is no cumulative voting with respect to the election of directors, with the result
that the holders of more than 50% of the shares eligible to vote for the election of directors can elect all of the directors. |
|
The number of directors, other than those elected
by one or more series of preferred stock, shall be fixed from time to time by the board of directors of the Combined Company.
The number of directors constituting the board
of directors upon the Closing will be five (5). |
| Removal of Directors |
| The current bylaws of Abri provide that any director may be removed, either for or without cause, at any time by action of the holders of a majority of the outstanding shares of stock entitled to vote thereon, either at a meeting of the holders of such shares or, whenever permitted by law, without a meeting by their written consents thereto. |
|
The Amended Charter provides that a director shall hold office until the next annual meeting following such director’s appointment or election and until his or her successor has been elected and qualified, subject, however, to such director’s earlier death, resignation, disqualification or removal. Any director may be removed without cause by the affirmative vote of the holders of not less than a majority of the outstanding stock of the Combined Company. |
| Vacancies on the Board of Directors |
| The Current Charter provides that vacancies and newly created directorships resulting from any increase in the number of directors may be filled by a majority of the directors then in office, though less than a quorum, and the directors so chosen shall hold office until the next annual election and until their successors are duly elected and shall qualify. A vacancy created by the removal of a director by the stockholders may be filled by the stockholders. |
|
Newly created directorships resulting from an increase in the number of directors and any vacancies on the board of directors of the Combined Company resulting from death, resignation, retirement, disqualification, removal or other cause may be filled solely by a majority vote of the remaining directors then in office, even if less than a quorum, or by a sole remaining director (and not by stockholders), and any director so chosen shall hold office for the remainder of the full term of the class of directors to which the new directorship was added or in which the vacancy occurred and until his or her successor has been elected and qualified, subject, however, to such director’s earlier death, resignation, retirement, disqualification or removal. |
| Special Meeting of the Stockholders |
The current bylaws of Abri provide that special meetings of the Abri Board
may be called by the Chief Executive Officer or by the number of directors who then legally constitute a quorum (two-thirds of the directors
in office). Notice of each special meeting shall, if mailed, be addressed to each director at least ten nor more than sixty days
prior to the date on which the meeting is to be held. |
|
Subject to any rights granted to the holders of any outstanding series of preferred stock, stockholders of the Combined Company shall not have the ability to call a special meeting. |
| Abri |
|
Combined Company |
| Stockholder Action by Written Consent |
| The Current Charter is silent on stockholder action by written consent. Notwithstanding the foregoing, Abri’s bylaws provided that whenever the stockholders are required or permitted to take any action by vote, such action may be taken without a meeting, without prior notice and without a vote, if a written consent or electronic transmission, setting forth the action so taken, shall be signed or e-mailed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting called for such purpose. |
|
Subject to any rights granted to the holders of any outstanding series of preferred stock, the Amended Charter prohibits stockholders from acting by written consent by specifying that any action required or permitted to be taken by stockholders must be effected by a duly called annual or special meeting and may not be effected by written consent. |
| Notice of Stockholders Meetings |
| Abri’s current bylaws provide that written or printed notice of the meeting stating the place, day and hour of the meeting and, in case of a special meeting, stating the purpose or purposes for which the meeting is called, and in case of a meeting held by remote communication stating such means, shall be delivered not less than ten nor more than sixty days before the date of the meeting, either personally, or by telegram, facsimile or cable or other electronic means, by or at the direction of the Chief Executive Officer, the Secretary, or the persons calling the meeting, to each stockholder of record entitled to vote at such meeting. Such notice shall be deemed to be given at the time of receipt thereof if given personally or at the time of transmission thereof if given by telegram, telex, facsimile or cable or other electronic means. |
|
The amended and restated bylaws of the Combined Company provide that notice of all meetings of stockholders shall be given in writing or by electronic transmission in the manner provided by applicable law stating the place, if any, date and time of the meeting, the means of remote communication, if any, by which stockholders and proxy holders may be deemed to be present in person and vote at such meeting and the record date for determining the stockholders entitled to vote at the meeting, if such date is different from the record date for determining stockholders entitled to notice of the meeting and, in the case of a special meeting, the purpose or purposes for which the meeting is called Unless otherwise required by applicable law or the Amended Charter, such notice shall be given not less than ten (10), nor more than sixty (60), days before the date of the meeting to each stockholder of record entitled to vote at such meeting as of the record date for determining stockholders entitled to notice of the meeting. |
| Amendment of Certificate of Incorporation |
| The Current Charter allows the right at any time and from time to time to amend, alter, change or repeal any provision contained in the Current Charter, and other provisions as authorized by the laws of the State of Delaware. |
|
In addition to any vote that may be required by law or the terms of any series of preferred stock, the Amended Charter may be amended or repealed by the affirmative vote of at least sixty-six and two thirds percent (66⅔%) of the outstanding shares of capital stock entitled to vote generally in the election of directors, voting as a single class. |
| Quorum |
| The current bylaws of Abri provide that the holders of a majority of the shares of capital stock issued and outstanding and entitled to vote, represented in person or by proxy, shall constitute a quorum at all meetings of the stockholders for the transaction of business, except as otherwise provided by statute or by the Current Charter. If, however, such quorum shall not be present or represented at any meeting of the stockholders, the stockholders present in person or represented by proxy shall have power to adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present or represented. At such adjourned meeting at which a quorum shall be present or represented any business may be transacted which might have been transacted at the meeting as originally notified. |
|
The holders of issued and outstanding capital stock representing a majority of the voting power of all outstanding shares of capital stock of the Combined Company entitled to vote at any meeting, present in person or by proxy, shall constitute a quorum for the transaction of business at any meetings of the stockholders; provided that when specified business is to be voted on by a class or series of stock voting as a class, the holders of shares representing a majority of the voting power of all outstanding shares of such class or series shall constitute a quorum of such class or series for the transaction of such business. |
| Abri |
|
Combined Company |
| Stockholder Proposals (Other than Nominations) |
| The Current Charter and Abri’s current bylaws are silent with respect to proposals of other business. |
|
Business (other than nominations) to be properly
brought before an annual meeting by a stockholder must have given timely notice in writing to the corporate secretary and such other business
must be a proper matter for stockholder action.
To be timely, notice must be received by the corporate
secretary not less than ninety (90) days nor more than one hundred twenty (120) days prior to the first anniversary of the preceding
year’s annual meeting; provided, however, that in the event that the date of the annual meeting is scheduled for more than thirty
(30) days before or after such anniversary date, notice must be delivered not later than the tenth (10th) day following
the day on which public announcement of the date of such meeting is first made. |
| Limitation of Liability of Directors |
| Pursuant to the Current Charter, the directors of Abri will not be personally liable for monetary damages to us for breaches of their fiduciary duty as directors, unless they violated their duty of loyalty to us or our stockholders, acted in bad faith, knowingly or intentionally violated the law, authorized unlawful payments of dividends, unlawful stock purchases or unlawful redemptions, or derived an improper personal benefit from their actions as directors. |
|
To the fullest extent permitted by applicable law, no director will have any personal liability to the Combined Company or its stockholders for monetary damages for any breach of fiduciary duty as a director (unless such director violated the duty of loyalty to the Combined Company or its stockholders, acted in bad faith, knowingly or intentionally violated the law, authorized unlawful payments of dividends, stock purchases or redemptions, or derived improper personal benefit from its actions as a director). |
| Indemnification of Directors and Officers |
| The Current Charter provides that Abri’s directors and officers will be indemnified by Abri to the fullest extent authorized by Delaware law as it now exists or may in the future be amended. The current bylaws of Abri also permits Abri to secure insurance on behalf of any officer, director or employee for any liability arising out of his or her actions, regardless of whether Delaware law would permit indemnification. Abri has purchased a policy of directors’ and officers’ liability insurance that insures our directors and officers against the cost of defense, settlement or payment of a judgment in some circumstances and insures Abri against Abri’s obligations to indemnify its directors and officers. |
|
The Combined Company, to the fullest extent permitted by law, shall indemnify any person made or threatened to be made a party to any action, suit or proceeding, whether criminal, civil, administrative or investigative, by reason of the fact that he or she is or was a director or officer of the Combined Company, while serving as a director or officer of the Combined Company, is or was serving as a director, officer, employee or agent of another entity at the request of the Combined Company. |
| Corporate Opportunity Provision |
The Current Charter provides 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. Abri’s officers and directors (other than our independent directors)
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: (1) our consummation of an initial business combination and (2) 12 months from
the date of this proxy statement (or up to 18 months from the closing of this offering if we extend the period of time to consummate
a business combination). |
|
The Amended Charter renounces any interest or expectancy of the Combined Company in, or in being offered an opportunity to participate in, any Excluded Opportunity. An “Excluded Opportunity” is any matter, transaction or interest that is presented to, or acquired, created or developed by, or which otherwise comes into the possession of, any director of the Combined Company who is not an employee or officer of the Combined Company or any of its subsidiaries (a “Covered Person”), unless such matter, transaction or interest is presented to, or acquired, created or developed by, or otherwise comes into the possession of, a Covered Person expressly and solely in such Covered Person’s capacity as a director of the Combined Company. |
| Abri |
|
Combined Company |
| 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. |
|
|
| Dividends |
| Subject to applicable law, the rights, if any, of the holders of any outstanding series of the preferred stock, the holders of shares of Common Stock shall be entitled to receive such dividends and other distributions (payable in cash, property or capital stock of the Abri) when, as and if declared thereon by the board of directors of Abri from time to time out of any assets or funds of Abri legally available therefor and shall share equally on a per share basis in such dividends and distributions. |
|
Subject to any rights of the holders of any series of preferred stock, the holders of Common Stock shall be entitled to receive such dividends and other distributions when, as and if declared by the board of directors out of the assets of the Combined Company that are by law available therefor and shall share such dividends and distributions equally on a per share basis. |
| Forum |
|
The Current Charter provides that, unless Abri
consents in writing to the selection of an alternative forum, to the fullest extent permitted by the applicable law, the Court of Chancery
of the State of Delaware shall be the sole and exclusive forum for any stockholder (including a beneficial owner) to bring (i) any
derivative action or proceeding brought on behalf of Abri, (ii) any action asserting a claim of breach of a fiduciary duty owed by
any director, officer or other employee of Abri to Abri or Abri’s stockholders, (iii) any action asserting a claim against
Abri, its directors, officers or employees arising pursuant to any provision of the DGCL or the Current Charter or the bylaws of Abri,
or (iv) any action asserting a claim against Abri, its directors, officers or employees governed by the internal affairs doctrine
and, if brought outside of Delaware, the stockholder bringing the suit will be deemed to have consented to service of process on such
stockholder’s counsel except any action (A) as to which the Court of Chancery in the State of Delaware determines that there
is an indispensable party not subject to the jurisdiction of the Court of Chancery (and the indispensable party does not consent to the
personal jurisdiction of the Court of Chancery within ten days following such determination), (B) which is vested in the exclusive
jurisdiction of a court or forum other than the Court of Chancery, or (C) for which the Court of Chancery does not have subject matter
jurisdiction.
However, the foregoing 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 courts have exclusive
jurisdiction and unless Abri consents in writing to the selection of an alternative forum, the federal district courts of the United States
of America shall, to the fullest extent permitted by law, be the exclusive forum for the resolution of any complaint asserting a cause
of action arising under the Securities Act of 1933, as amended, or the rules and regulations promulgated thereunder. |
|
Except with the consent of the Combined Company to the selection of an alternative forum, the Court of Chancery of the State of Delaware shall be the sole and exclusive forum for certain stockholder litigation, except for any action as to which the Chancery Court determines that there is an indispensable party not subject to the jurisdiction of such court and to which jurisdiction such party does not consent within ten (10) days of such determination, which is vested in the exclusive jurisdiction of a court or forum other than the Chancery Court or for which the Chancery Court does not have subject matter jurisdiction, or any action arising under the Securities Act as to which the Chancery Court and the federal district court for the District of Delaware shall have concurrent jurisdiction. The preceding exclusive forum provision does not apply to suits brought to enforce any liability or duty created by the Exchange Act or any other claim for which the federal courts have exclusive jurisdiction. |
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Relationship Between
Abri and DLQ Parent After Closing
Following
the Closing of the Merger Agreement, and assuming no redemptions or Earnout Shares, DLQ Parent will own approximately 59.3% of the total
issued and outstanding shares of Abri Common Stock (based on no redemptions), or up to 65% of the total issued and outstanding shares
of Abri Common Stock (based on Maximum Redemptions), and DLQ Parent Stockholders will own approximately 20% of the total issued and outstanding
shares of Abri Common Stock (based on no redemptions), or up to 21% of the total issued and outstanding shares of Abri Common Stock (based
on Maximum Redemptions). As discussed herein, Abri will be a Controlled Company by virtue of this ownership the management of DLQ Parent
could be able to exercise voting power control over Abri.
Abri Related Person
Transactions
Founder Shares
On
April 12, 2021, the Sponsor paid $25,000, or $0.017 per share, to cover certain offering costs in consideration for 1,437,500 founder
shares. Up to 187,500 founder shares were subject to forfeiture by the Sponsor depending on the extent to which the underwriters’
over-allotment option was exercised. On August 23, 2021, the Underwriters partially exercised the over-allotment option
to purchase 276,250 Private Units. As a result, 4,020 founder shares were forfeited.
On
the date of the IPO, the founder shares were placed into an escrow account maintained in New York, New York by Continental Stock
Transfer & Trust Company, acting as escrow agent. Subject to certain limited exceptions, these shares will not be transferred,
assigned, sold or released from escrow (subject to certain limited exceptions) for a period ending on (1) with respect to fifty percent
(50%) of the founder shares, the earlier of one year after the date of the consummation of Abri’s initial business combination and
the date on which the closing price of Abri’s shares of Common Stock equals or exceeds $12.50 per share (as adjusted for share splits,
share capitalizations, reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period
commencing after Abri’s initial business combination and (2) with respect to the remaining fifty percent (50%) of the founder
shares, one year after the date of Abri’s consummation of the initial business combination, or earlier, in either case, if, subsequent
to the initial business combination, Abri consummates a liquidation, merger, stock exchange or other similar transaction which results
in all of the stockholders having the right to exchange their shares of Common Stock for cash, securities or other property.
Private Units
Simultaneously
with the closing of the IPO, Abri consummated the sale of 276,250 Private Units at a price of $10.00 per Private Unit in the Private
Placement to the Sponsor, generating gross proceeds of $2,762,500. Each Private Unit consists of (i) one shares of Common Stock,
and (ii) one Warrant. Abri granted the Underwriters in the IPO a 45-day option to purchase up to 750,000 additional Public Units to
cover over-allotments, if any. On August 23, 2021, the Underwriters partially exercised the over-allotment option to purchase
733,920 Public Units, generating an aggregate of gross proceeds of $7,339,200. In connection with the Underwriters’ exercise of
their over-allotment option, Abri also consummated the sale of an additional 18,348 Private Units at $10.00 per Private Unit
to the Sponsor, generating gross proceeds of $183,480.
Promissory Note
On
April 20, 2021, the Sponsor agreed to loan Abri up to $300,000 to be used for a portion of the expenses of the IPO (the “Promissory
Note”). These loans were non-interest bearing, unsecured and were due at the earlier of December 31, 2021 or the
closing of the IPO. As of December 31, 2021, there was a zero balance outstanding under the note.
On
March 8, 2022, Abri issued a convertible promissory note (the “First Working Capital Note”) to the Sponsor.
Pursuant to the First Working Capital Note, the Sponsor agreed to loan us an aggregate principal amount of $300,000. On April 4,
2022, Abri issued a second convertible promissory note for an aggregate principal amount of $500,000 (the “Second Working
Capital Note”) to the Sponsor. On August 26, 2022, Abri issued a third convertible promissory note for an aggregate
principal amount of $300,000 (the “Third Working Capital Note”) to the Sponsor. On November 22, 2022, Abri
issued a fourth convertible promissory note for an aggregate principal amount of $150,000 (the “Fourth Working Capital Note”)
to the Sponsor. On January 17, 2023, Abri issued a fifth convertible promissory note for an aggregate principal amount of $200,000
(the “Fifth Working Capital Note”) to the Sponsor. On February 10, 2023, Abri issued a fifth convertible
promissory note for an aggregate principal amount of $150,000 (the “Sixth Working Capital Note”) and on July
31, 2023, the Company issued a seventh working capital note in the amount of $11,250 (the “Seventh Working Capital Note”)
to the Sponsor (the First Working Capital Note through the Seventh Working Capital Notes are hereinafter referred to as the “Working
Capital Notes”). The Working Capital Notes were issued to fund working capital of the Company. The Working Capital Notes
are non-interest bearing and all outstanding amounts under the Working Capital Notes will be due on the date on which we consummate
our initial business combination (the “Maturity Date”).
Consulting Agreements
On
September 21, 2021, Abri entered into a Consulting Agreement with Chardan Capital Markets LLC (“Abri Consulting Agreement”)
whereby Chardan was to provide certain merger and acquisition and capital markets advisory services to Abri with respect to their efforts
to engage in an initial business combination transaction. Chardan will receive 30,000 shares of Common Stock upon the closing of
the Business Combination with DLQ in connection with this agreement. On the date of the Closing, based on a stock price of $10.00, the
shares would have a value of $300,000. This is a fixed fee arrangement, and in addition to the $1,500,000 deferred underwriting fee due
to Chardan pursuant to the Underwriting Agreement dated August 9, 2021 in connection with the IPO.
Related Party Loans
In
order to meet the working capital needs following the consummation of the IPO if the funds not held in the Trust Account are insufficient,
the Sponsor, Initial Stockholders, officers, directors and their affiliates may, but are not obligated to, loan Abri funds, from time
to time or at any time, in whatever amount they deem reasonable in their sole discretion. Each working capital loan would be evidenced
by a promissory note. The notes would either be paid upon consummation of the initial business combination, without interest, or, at the
holder’s discretion, up to $1,500,000 of the notes may be converted into Units at a price of $10.00 per Unit. The Units would
consist of (i) one shares of Common Stock, which consists of one share of Common Stock and one-quarter of one Warrant, and (ii) one-quarter of
one Warrant, where the Common Stock and warrants would be identical to the Common Stock and warrants included in the Private Units. In
the event that the initial business combination does not close, Abri may use a portion of the working capital held outside the Trust Account
to repay such loaned amounts, but no other proceeds from the Trust Account would be used for such repayment.
On
March 8, 2022, Abri issued the First Working Capital Note to the Sponsor where the Sponsor agreed to loan us an aggregate principal
amount of $300,000. On April 4, 2022, Abri issued the Second Working Capital Note to the Sponsor where the Sponsor agreed to loan
us an aggregate principal amount of $500,000. On August 26, 2022, Abri issued the Third Convertible Promissory note for an aggregate
principal amount of $300,000 to the Sponsor. On November 21, 2022, the Company issued the Fourth Convertible Promissory Note for
an aggregate principal amount of $150,000 to the Sponsor. On January 17, 2023, Abri issued the Fifth Convertible Promissory Note
for an aggregate principal amount of $200,000 to the Sponsor. On February 10, 2023, Abri issued a sixth convertible promissory note
for an aggregate principal amount of $150,000 to the Sponsor. The Working Capital Notes was issued to fund working capital of the Company.
The Working Capital Notes are non-interest bearing and all outstanding amounts under the Working Capital Notes will be due on the
date on which we consummate our initial business combination, the Maturity Date. If a business combination is not consummated, and there
are insufficient funds to repay the Working Capital Notes, the unpaid amounts would be forgiven. All or a portion of the amounts outstanding
under the Working Capital Notes may be converted on the Maturity Date into units at a price of $10.00 per unit at the option of the Sponsor.
The units would be identical to the Company’s outstanding Private Units that were issued to the Sponsor in the Private Placement.
The Working Capital Notes contain customary events of default, including, among others, those relating to the Company’s failure
to make a payment of principal when due and to perform any other obligations that is not timely cured after written notice of such default
from the Sponsor.
Administrative Service
Fee
Commencing
on the effective date of the registration statement of the IPO through the acquisition of a target business, Abri pays an affiliate of
the Chief Executive Officer, an aggregate fee of $10,000 per month for providing Abri with office space and certain office and secretarial
services. Abri has recorded $180,000 for the period from March 18, 2021 through September 30, 2022.
Other
than the foregoing, no compensation of any kind, including any finder’s fee, reimbursement, consulting fee or monies in respect
of any payment of a loan, will be paid by us to the Sponsor, officers and directors, or any of their affiliates, prior to, or in connection
with any services rendered in order to effectuate, the consummation of an initial business combination (regardless of the type of transaction
that it is). However, these 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 business combinations. Our audit
committee will review on a quarterly basis all payments that were made to the Sponsor, officers, directors or our or their affiliates
and will determine which expenses and the amount of expenses that will be reimbursed. There is no cap or ceiling on the reimbursement
of out-of-pocket expenses incurred by such persons in connection with activities on our behalf.
Related Party Policy
Abri’s
Code of Ethics requires us to avoid, wherever possible, all related party transactions that could result in actual or potential conflicts
of interests, except under guidelines approved by the Board (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 five percent (5%) beneficial owner of our shares of 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 ten percent (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 his or her work objectively and effectively. Conflicts of interest may also arise
if a person, or a member of his or her family, receives improper personal benefits as a result of his or her position.
The
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. The audit committee will consider all relevant factors when determining whether to approve a related
party transaction, including whether the related party transaction is on terms no less favorable to us than terms generally available
from an unaffiliated third-party under the same or similar circumstances and the extent of the related party’s interest in
the transaction. No director may participate in the approval of any transaction in which he is a related party, but that director is required
to provide the audit committee with all material information concerning the transaction. We also 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 conflicts of interest, we have agreed not to consummate an initial business combination with an entity that is affiliated
with any of the Sponsor, officers or directors unless we have obtained an opinion from an independent investment banking firm, or another
independent entity that commonly renders valuation opinions, and the approval of a majority of our disinterested independent directors
that the business combination is fair to our unaffiliated stockholders from a financial point of view.
DLQ Related Party
Transactions
In
both 2022 and 2021, DLQ made advances to two related parties, including Push Interactive, DLQ’s subsidiary, and obtained funding
from Logiq, Inc. to support the operations of the business. The related party receivable as of December 31, 2022 and 2021, amounts
to approximately $3,779,924 and $2,200,000, respectively. The related party payable as of December 31, 2022 and 2021, amount to approximately
$7,863,000 and $6,325,000, respectively. There are no formal written promissory notes or other contract relating to each and neither accrue
interest.
On
November 8, 2022, DLQ entered into a Managed Services Agreement (the “MSA”) with a significant new client
(the “Client”) and will provide certain affiliate management, website development, lead generation, email management,
and search engine optimization services (collectively, the “Services”) to Client through DLQ’s platform.
The MSA will terminate on October 31, 2023, provided that the term may be extended beyond such date by mutual written agreement of
the parties. Notwithstanding the foregoing, Client may terminate the MSA at any time after January 1, 2023, without cost or any penalty,
in the event that it is dissatisfied with the Services provided thereunder.
In
connection with the MSA, on November 8, 2022, DLQ Parent and Client also entered into an Independent Contractor Agreement (the “IC
Agreement,” and together with the MSA, the “Agreements”), pursuant to which Client will provide,
on a non-exclusive basis, certain business development strategies and execution and consulting services regarding e-commerce, digital
marketing, and online advertising, including lead generation, affiliate marketing and brand development to DLQ Parent. The term of the
IC Agreement coincides with the term of the MSA.
As
compensation for the services to be provided by Client to DLQ Parent under the IC Agreement, DLQ Parent agreed to issue Client 1,750,000
restricted shares of Logiq, Inc. common stock (the “Initial Shares”) upon execution of the Agreements. In the
event that the proposed acquisition of DLQ by Abri SPAC I, Inc., is not completed on or before April 1, 2023, then DLQ shall issue
Client an additional 1,750,000 restricted shares of Logiq, Inc. common stock (such additional shares together with the Initial Shares,
the “Registrable Shares”) as further contingent consideration pursuant to the Agreements.
On September 5, 2023, DLQ
entered into an agreement with certain institutional investors (the “Investors”) for a $5 million investment in DLQ
(the “DLQ Investment”) in the form of convertible promissory notes issued by DLQ (the “DLQ Notes”).
The DLQ Notes shall convert into such number of shares of common stock of DLQ (the “Conversion Shares”), that would be exchanged
for 1,600,000 Merger Consideration Shares at the Closing. As a condition to the DLQ Investment, the Investors requested an assurance mechanism
from DLQ to protect the Investors in the event they were unable to recoup the full value of the DLQ Investment. DLQ agreed to put into
escrow 1,500,000 Merger Consideration Shares (the “Reset Shares”), which shares would be released to the Investors
to cover any shortfall of the DLQ Investment, up to the maximum amount of Reset Shares. After the Closing of the Business Combination,
once the Investors recoup the DLQ Investment, any remaining Reset Shares not released to the Investors, would be distributed to DLQ Parent
Stockholders as additional Dividend Shares. In addition, approximately 6 million Merger Consideration Shares, not distributed to DLQ Parent
Stockholders, shall be placed in an escrow account until the DLQ Investment has been recouped by the Investors, or all the Reset Shares
have been released.
The DLQ Investment funds were
put into an escrow account and released at Closing to pay certain fees and expenses in connection with the Business Combination, including
closing costs including the deferred underwriter’s fee and for working capital. To the extent not utilized to consummate the Business
Combination, the remaining proceeds from the DLQ Investment and the proceeds from the Trust Account after redemptions will be used for
general corporate purposes, including, but not limited to, working capital for operations, capital expenditures and future acquisitions.
Investors have also received a $5 million convertible note issued by DLQ Parent (the “LGIQ Note”), which shall, at
the option of the Investors, convert into such number of shares of Common Stock of DLQ Parent (“LGIQ Shares”) derived
by dividing $5 million by closing share price of LGIQ on the date of conversion.
To the extent not utilized
to consummate the Business Combination, the proceeds from the Trust Account after redemptions will be used for general corporate purposes,
including, but not limited to, working capital for operations, capital expenditures and future acquisitions.
Certain Transactions
of DLQ
DLQ’s
Code of Business Conduct and Ethics states that a conflict of interest occurs when an employee’s private interest interferes, or
appears to interfere, in any way with the interests of DLQ as a whole. An employee should actively avoid any private interest that may
impact such employee’s ability to act in the interests of DLQ or that may make it difficult to perform the employee’s work
objectively and effectively. A conflict of interest situation can arise when a person takes actions or has interests that may make it
difficult to perform his work objectively and effectively. Conflicts of interest may also arise if a person, or a member of his family,
receives improper personal benefits as a result of his position. DLQ’s Code of Business Conduct and Ethics requires that employees
fully disclose any situations that could reasonably be expected to give rise to a conflict of interest to the Compliance Officer. Conflicts
of interest may only be waived by the Board, or the appropriate committee of the Board, and will be promptly disclosed to the public to
the extent required by law and applicable rules of the applicable stock exchange.
Where
such conflict is deemed to constitute a related party transaction, DLQ’s audit committee, pursuant to its written charter, is responsible
for reviewing and approving such transactions to the extent they are entered into. In doing so, the audit committee will discuss with
the independent auditor its evaluation of DLQ’s identification of, accounting for and disclosure of its relationships with related
parties as set forth under the standards of the PCAOB.
Related Party Transaction
Policy
Effective
upon Closing, the Combined Company expects to adopt a related party transaction policy that sets forth its procedures for the identification,
review, consideration and approval or ratification of related party transactions. The policy will become effective upon Closing. For purposes
of the Combined Company’s policy only, a related party transaction is a transaction, arrangement or relationship, or any series
of similar transactions, arrangements or relationships, in which the Combined Company and any related party are, were or will be participants
in which the amount involved exceeds $120,000. Transactions involving compensation for services provided to the Combined Company as an
employee or director are not covered by this policy. A related party is any executive officer, director or beneficial owner of more than
five percent (5%) of any class of the Combined Company’s voting securities and any of their respective immediate family members
and any entity owned or controlled by such persons.
Under
the policy, if a transaction has been identified as a related party transaction, including any transaction that was not a related party
transaction when originally consummated or any transaction that was not initially identified as a related party transaction prior to consummation,
the Combined Company’s management must present information regarding the related person transaction to the Combined Company’s
audit committee, or, if audit committee approval would be inappropriate, to another independent body of the Combined Company’s Board
of Directors, for review, consideration and approval or ratification. The presentation must include a description of, among other things,
the material facts, the interests, direct and indirect, of the related persons, the benefits to the Combined Company of the transaction
and whether the transaction is on terms that are comparable to the terms available to or from, as the case may be, an unrelated third
party or to or from employees generally. Under the policy, the Combined Company will collect information that the Combined Company deems
reasonably necessary from each director, executive officer and, to the extent feasible, significant stockholder to enable the Combined
Company to identify any existing or potential related-person transactions and to effectuate the terms of the policy. In addition,
under the Combined Company’s Code of Conduct that the Combined Company expects to adopt prior to the closing of the Business Combination,
the Combined Company’s employees and directors will have an affirmative responsibility to disclose any transaction or relationship
that reasonably could be expected to give rise to a conflict of interest. In considering related person transactions, the Combined Company’s
audit committee, or other independent body of the Combined Company’s board of directors, will take into account the relevant available
facts and circumstances including, but not limited to:
| · | the risks, costs and benefits to the Combined Company; |
| · | the impact on a director’s independence in the event that
the related party is a director, immediate family member of a director or an entity with which a director is affiliated; |
| · | the availability of other sources for comparable services or
products; and |
| · | the terms available to or from, as the case may be, unrelated
third parties or to or from employees generally. |
The
policy requires that, in determining whether to approve, ratify or reject a related party transaction, the Combined Company’s audit
committee, or other independent body of the Combined Company’s Board of directors, must consider, in light of known circumstances,
whether the transaction is in, or is not inconsistent with, the Combined Company’s best interests and those of the Combined Company’s
stockholders, as the Combined Company’s audit committee, or other independent body of the Combined Company’s board of directors,
determines in the good faith exercise of its discretion.
EXPERTS
The financial statements of
Abri SPAC I, Inc. as of December 31, 2022 and 2021 for the year ended December 31, 2022 and for the period from March 18, 2021 (inception)
through December 31, 2021 included in this proxy statement have been so included in reliance on the report of BDO USA, LLP (n/k/a
BDO USA, P.C.), an independent registered public accounting firm, appearing elsewhere herein and in the proxy statement, given on
the authority of said firm as experts in auditing and accounting. The report on the financial statements contains an explanatory paragraph
regarding the Company’s ability to continue as a going concern.
The
carve-out consolidated financial statements of DLQ, Inc. and its subsidiaries as of and for the years ended December 31,
2022 and 2021, have been audited by Frazier & Deeter, LLC, an independent registered public accounting firm, as stated in their
report appearing herein. Such carve-out consolidated financial statements are included in this proxy statement in reliance upon the
report (which report includes an explanatory paragraph relating to DLQ’s ability to continue as a going concern) of Frazier &
Deeter, LLC, appearing elsewhere herein, and upon the authority of such firm as experts in accounting and auditing.
OTHER BUSINESS
The Board knows of no matter
other than those described herein that will be presented for consideration at the Meeting. However, should any other matters properly
come before the Meeting or any adjournments or postponements thereof, it is the intention of the person(s) named in the accompanying proxy
to vote in accordance with their best judgment in the interest of the Company.
MISCELLANEOUS
Logiq will bear all costs
incurred in the solicitation of proxies. In addition to solicitation by mail, our officers and employees may solicit proxies by telephone,
the Internet or personally, without additional compensation. We may also make arrangements with brokerage houses and other custodians,
nominees and fiduciaries for the forwarding of solicitation materials to the beneficial owners of shares of our Common Stock held of record
by such persons, and we may reimburse such brokerage houses and other custodians, nominees and fiduciaries for their out-of-pocket expenses
incurred in connection therewith. We have not engaged a proxy solicitor.
The SEC has adopted rules
that permit companies and intermediaries such as brokers to satisfy delivery requirements for proxy statements with respect to two or
more stockholders sharing the same address by delivering a single proxy statement addressed to those stockholders. This process, which
is commonly referred to as “householding,” potentially provides extra convenience for stockholders and cost savings for companies.
Logiq and some brokers household proxy materials may deliver a single proxy statement to multiple stockholders sharing an address unless
contrary instructions have been received from the affected stockholders. Once you have received notice from your broker or Logiq that
they or Logiq will be householding materials to your address, householding will continue until you are notified otherwise or until you
revoke your consent. If, at any time, you no longer wish to participate in householding and would prefer to receive a separate Proxy Statement,
please notify your broker if your shares are held in a brokerage account or Logiq if you hold registered shares of Common Stock. We will
also deliver a separate copy of this Proxy Statement to any stockholder upon written request. Similarly, stockholders who have previously
received multiple copies of disclosure documents may write to the address or call the phone number listed below to request delivery of
a single copy of these materials in the future. You can notify Logiq by sending a written request to Brent Suen, President and Executive
Chairman, 85 Broad Street, 16-079, New York, NY 10004, by registered, certified or express mail or by calling Logiq at (808) 829-1057.
SUBMISSION OF STOCKHOLDER PROPOSALS
Our Board is aware of no other
matter that may be brought before the Meeting. Under Delaware law, only business that is specified in the notice of a special meeting
to stockholders may be transacted at the Meeting.
Questions FUTURE
STOCKHOLDER PROPOSALS
Stockholder proposals, including
director nominations, for the 2023 annual meeting must be received at our principal executive offices by not earlier than the opening
of business on the 120th day before the 2023 annual meeting and not later than the later of (x) the close of business
on the 90th day before the 2023 annual meeting or (y) the close of business on the 10th day following
the first day on which we publicly announce the date of the 2023 annual meeting, and must otherwise comply with applicable SEC rules
and the advance notice provisions of our bylaws, to be considered for inclusion in our proxy materials relating to our 2023 annual meeting.
You may contact our Secretary
at our principal executive offices for a copy of the relevant bylaw provisions regarding the requirements for making stockholder proposals
and nominating director candidates.
WHERE YOU CAN FIND ADDITIONAL INFORMATION
We file annual, quarterly
and current reports, proxy statements, and other information with the SEC. The SEC maintains a website at http://www.sec.gov that contains
reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC.
If you are a stockholder of
Logiq and would like to request documents, please do so by October 16, 2023, in order to receive them before the Meeting. If you request
any documents from us, we will mail them to you by first class mail, or another equally prompt means.
All information contained
in this proxy statement relating to Logiq and/or DLQ has been supplied by Logiq and/or DLQ, and all such information relating to Abri
has been supplied by Abri. Information provided by either the Abri or Abri does not constitute any representation, estimate or projection
of any other party.
This document is a proxy statement
of Logiq for the Meeting. We have not authorized anyone to give any information or make any representation about the Business Combination,
us or Abri that is different from, or in addition to, that contained in this proxy statement. Therefore, if anyone does give you information
of this sort, you should not rely on it. The information contained in this proxy statement speaks only as of the date of this proxy statement
unless the information specifically indicates that another date applies.
| October 10, 2023 |
By Order of the Board of Directors |
|
| |
|
|
|
| |
|
/s/ Brent Suen |
|
| |
|
Brent Suen,
President and Executive Chairman |
|
INDEX TO FINANCIAL
STATEMENTS
ABRI SPAC I, INC.
| |
|
Page |
| REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM (BDO USA, LLP, Potomac, Maryland, PCAOB ID#243) |
|
F-2 |
| Balance Sheets as of December 31, 2022 and 2021 |
|
F-3 |
| Statements of Operations for the year ended December 31, 2022 and the period March 18, 2021 (inception) to December 31, 2021 |
|
F-4 |
| Statements of Changes in Stockholders’ Equity (Deficit) and Redeemable Common Stock for the year ended December 31, 2022 and the period March 18, 2021 (inception) to December 31, 2021 |
|
F-5 |
| Statements of Cash Flows or the year ended December 31, 2022 and the period March 18, 2021 (inception) to December 31, 2021 |
|
F-6 |
| Notes to Financial Statements |
|
F-7 |
| |
|
|
| Condensed Balance Sheets as of June 30, 2023 (Unaudited) and December 31, 2022 |
|
F-28 |
| Condensed Statements of Operations for the Three and Six Months Ended June 30, 2023 (Unaudited) and for the Three and Six Months Ended June 30, 2022 (Unaudited) |
|
F-29 |
| Condensed Statements of Changes in Stockholders’ Equity (Deficit) and Redeemable Common Stock for the Three and Six Months Ended June 30, 2023 (Unaudited) and for the Three and Six Months Ended June 30, 2022 (Unaudited) |
|
F-30 |
| Condensed Statements of Cash Flows for the Six Months Ended June 30, 2023 (Unaudited) and for the Six Months Ended June 30, 2022 (Unaudited) |
|
F-31 |
| Notes to Financial Statements (Unaudited) |
|
F-32 |
DLQ INC.
CARVE-OUT CONSOLIDATED FINANCIAL STATEMENTS
REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Stockholders
and Board of Directors
ABRI
SPAC I, Inc.
Beverly
Hills, CA
Opinion
on the Financial Statements
We
have audited the accompanying balance sheets of ABRI SPAC I, Inc. (the “Company”) as of December 31, 2022 and 2021,
the related statements of operations, changes in stockholders’ equity (deficit) and redeemable common stock, and cash flows for the
year ended December 31, 2022 and for the period from March 18, 2021 (inception) to December 31, 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, results of operations, and cash flows of the Company in conformity with
accounting principles generally accepted in the United States of America
Going
Concern Uncertainty
The
accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1
to the financial statements, the Company does not have sufficient cash and working capital to sustain its operations and the Company’s
ability to execute its business plan is dependent upon its consummation of an initial business combination described in Note 1 to
the financial statements. These conditions raise substantial doubt about its ability to continue as a going concern. Management’s
plans in regard to these matters are also described in Note 1. 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 audits. 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 audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits
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 audits, 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
audits 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 audits 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 audits
provide a reasonable basis for our opinion.
/s/
BDO USA, LLP
We
have served as the Company’s auditor since 2021.
Potomac,
Maryland
March 30,
2023
ABRI
SPAC I, INC.
BALANCE SHEETS
| | |
December 31,
2022 | | |
December 31,
2021 | |
| ASSETS | |
| | | |
| | |
| Current
assets: | |
| | | |
| | |
| Cash | |
$ | 381,293 | | |
$ | 154,942 | |
| Prepaid
expenses and other current assets | |
| 252,463 | | |
| 321,590 | |
| Total
current assets | |
| 633,756 | | |
| 476,532 | |
| | |
| | | |
| | |
| Marketable
securities held in Trust Account | |
| 12,841,399 | | |
| 57,340,207 | |
| Total
assets | |
$ | 13,475,155 | | |
$ | 57,816,739 | |
| | |
| | | |
| | |
| LIABILITIES,
REDEEMABLE COMMON STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT) | |
| | | |
| | |
| Current
liabilities: | |
| | | |
| | |
| Accounts
payable and accrued expenses | |
$ | 441,739 | | |
$ | 163,357 | |
| Accrued
legal fees | |
| 2,113,078 | | |
| 524,174 | |
| Total
current liabilities | |
| 2,554,817 | | |
| 687,531 | |
| Promissory
notes, related party | |
| 1,146,784 | | |
| — | |
| Convertible
promissory notes, related party | |
| 1,250,000 | | |
| — | |
| Warrant
liabilities | |
| 17,676 | | |
| 170,867 | |
| Deferred
underwriting commissions | |
| 1,500,000 | | |
| 1,500,000 | |
| Total
liabilities | |
| 6,469,277 | | |
| 2,358,398 | |
| | |
| | | |
| | |
| Commitments
and Contingencies (Note 5) | |
| | | |
| | |
| | |
| | | |
| | |
| Common
stock subject to possible redemption, par value $0.0001, 100,000,000 shares authorized; 1,252,372 and 5,733,920 shares
outstanding as of December 31, 2022 and 2021, respectively | |
| 12,841,399 | | |
| 52,323,289 | |
| Stockholders’
equity: | |
| | | |
| | |
| Preferred
stock, par value $0.0001, 1,000,000 shares authorized, none issued and outstanding | |
| — | | |
| — | |
| Common
stock, par value $0.0001, 100,000,000 shares authorized; 1,728,078 shares issued and outstanding | |
| 173 | | |
| 173 | |
| Additional
paid-in capital | |
| — | | |
| 4,262,491 | |
| Accumulated
deficit | |
| (5,835,694 | ) | |
| (1,127,612 | ) |
| Total
stockholders’ equity (deficit) | |
| (5,835,521 | ) | |
| 3,135,052 | |
| Total
liabilities, redeemable common stock and stockholders’ equity (deficit) | |
$ | 13,475,155 | | |
$ | 57,816,739 | |
The
accompanying notes are an integral part of these financial statements.
ABRI
SPAC I, INC.
STATEMENTS OF OPERATIONS
| | |
For
the
Year Ended
December 31,
2022 | | |
For
the
Period
March 18,
2021
(Inception)
Through
December 31,
2021 | |
| Operating
expenses: | |
| | | |
| | |
| Professional
fees | |
$ | 2,407,874 | | |
$ | 686,358 | |
| Selling,
general and administrative | |
| 960,904 | | |
| 448,445 | |
| Total
operating expenses | |
| 3,368,778 | | |
| 1,134,803 | |
| | |
| | | |
| | |
| Loss
from operations | |
| (3,368,778 | ) | |
| (1,134,803 | ) |
| | |
| | | |
| | |
| Other
income: | |
| | | |
| | |
| Interest
income | |
| 834,403 | | |
| 1,299 | |
| Change
in fair value of warrant liabilities | |
| 153,191 | | |
| 5,892 | |
| | |
| 987,594 | | |
| 7,191 | |
| | |
| | | |
| | |
| Loss
before income taxes | |
| (2,381,184 | ) | |
| (1,127,612 | ) |
| Provision
for income taxes | |
| (119,000 | ) | |
| — | |
| | |
| | | |
| | |
| Net
loss | |
$ | (2,500,184 | ) | |
$ | (1,127,612 | ) |
| | |
| | | |
| | |
| Weighted-average
common shares outstanding, basic and diluted, redeemable shares subject to redemption | |
| 5,463,799 | | |
| 2,789,393 | |
| Basic
and diluted net loss per share, redeemable shares subject to redemption | |
$ | (0.06 | ) | |
$ | (0.15 | ) |
| | |
| | | |
| | |
| Weighted-average
common shares outstanding, basic and diluted, non-redeemable shares | |
| 1,728,078 | | |
| 1,447,964 | |
| Basic
and diluted net loss per share, non-redeemable shares | |
$ | (1.25 | ) | |
$ | (0.49 | ) |
The
accompanying notes are an integral part of these financial statements.
ABRI
SPAC I, INC.
STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
(DEFICIT) AND REDEEMABLE COMMON STOCK
For the year ended December 31, 2022 and for the period March 18, 2021
(Inception) through December 31, 2021
| | |
|
Common
Stock Subject to Possible Redemption
| | |
|
Common
Stock | | |
| | | |
|
| | |
| | |
| | |
| Shares | | |
| Amount | | |
| Shares | | |
| Amount | | |
| Additional
Paid-in
Capital | | |
| Accumulated
Deficit | | |
| Total
Stockholder’s
Equity
(Deficit) | |
| Balance,
January 1, 2022 | |
| 5,733,920 | | |
$ | 52,323,289 | | |
| 1,728,078 | | |
$ | 173 | | |
$ | 4,262,491 | | |
$ | (1,127,612 | ) | |
$ | 3,135,052 | |
| Accretion
of common stock to redemption value | |
| — | | |
| 6,470,389 | | |
| — | | |
| — | | |
| (4,262,491 | ) | |
| (2,207,898 | ) | |
| (6,470,389 | ) |
| Net
loss | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| (2,500,184 | ) | |
| (2,500,184 | ) |
| Redemption
of common stock | |
| (4,481,548 | ) | |
| (45,952,279 | ) | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | |
| Balance
at December 31, 2022 | |
| 1,252,372 | | |
$ | 12,841,399 | | |
| 1,728,078 | | |
$ | 173 | | |
$ | — | | |
$ | (5,835,694 | ) | |
$ | (5,835,521 | ) |
| | |
|
Common
Stock Subject to
Possible Redemption | | |
|
Common
Stock | | |
|
| | |
|
| | |
| | |
| | |
| Shares | | |
| Amount | | |
| Shares | | |
| Amount | | |
| Additional
Paid-in
Capital | | |
| Accumulated
Deficit | | |
| Total
Stockholder’s
Equity
(Deficit) | |
| Balance,
March 18, 2021 (inception) | |
| — | | |
$ | — | | |
| — | | |
$ | — | | |
$ | — | | |
$ | — | | |
$ | — | |
| Issuance
of common stock to founders for cash | |
| — | | |
| — | | |
| 1,437,500 | | |
| 144 | | |
| 24,856 | | |
| — | | |
| 25,000 | |
| Sale
of 5,733,920 Units, net of underwriting discounts and offering costs | |
| 5,733,920 | | |
$ | 50,589,849 | | |
| — | | |
| | | |
| | | |
| | | |
| — | |
| Sale
of 294,598 Private Units | |
| — | | |
| — | | |
| 294,598 | | |
| 29 | | |
| 2,945,951 | | |
| — | | |
| 2,945,980 | |
| Private
warrant liability | |
| — | | |
| — | | |
| — | | |
| — | | |
| (176,759 | ) | |
| — | | |
| (176,759 | ) |
| Public
warrant allocation | |
| — | | |
| — | | |
| — | | |
| — | | |
| 3,201,884 | | |
| — | | |
| 3,201,884 | |
| Accretion
of common stock to redemption value | |
| — | | |
| 1,733,440 | | |
| — | | |
| — | | |
| (1,733,440 | ) | |
| — | | |
| (1,733,440 | ) |
| Forfeiture of founder’s
shares | |
| — | | |
| — | | |
| (4,020 | ) | |
| — | | |
| — | | |
| — | | |
| — | |
| Net
loss | |
| — | | |
| — | | |
| | | |
| — | | |
| | | |
| (1,127,612 | ) | |
| (1,127,612 | ) |
| Balance
at December 31, 2021 | |
| 5,733,920 | | |
$ | 52,323,289 | | |
| 1,728,078 | | |
$ | 173 | | |
$ | 4,262,491 | | |
$ | (1,127,612 | ) | |
$ | 3,135,052 | |
The
accompanying notes are an integral part of these financial statements.
ABRI
SPAC I, INC.
STATEMENTS OF CASH FLOWS
| | |
For the Year
Ended
December 31,
2022 | | |
For the
Period
March 18,
2021
(Inception)
Through
December 31,
2021 | |
| CASH
FLOWS FROM OPERATING ACTIVITIES: | |
| | | |
| | |
| Net
loss | |
$ | (2,500,184 | ) | |
$ | (1,127,612 | ) |
| Adjustments
to reconcile net loss to net cash used in operating activities: | |
| | | |
| | |
| Change
in fair value of warrant liabilities | |
| (153,191 | ) | |
| (5,892 | ) |
| Interest
earned on marketable securities held in Trust Account | |
| — | | |
| (1,299 | ) |
| Changes
in operating assets and liabilities: | |
| | | |
| | |
| Prepaid
expenses and other current assets | |
| 69,127 | | |
| (321,590 | ) |
| Accounts
payable and accrued expenses | |
| 1,867,286 | | |
| 687,531 | |
| Net
cash used in operating activities | |
| (716,962 | ) | |
| (768,862 | ) |
| | |
| | | |
| | |
| CASH
FLOWS FROM INVESTING ACTIVITIES: | |
| | | |
| | |
Cash
withdrawn from Trust Account for payment to redeeming
stockholders | |
| 45,952,279 | | |
| — | |
| Investments
in marketable securities held in Trust Account | |
| (1,853,471 | ) | |
| (57,338,908 | ) |
| Withdrawal
from Trust Account to pay taxes | |
| 400,000 | | |
| — | |
| Net
cash provided by (used in) investing activities | |
| 44,498,808 | | |
| (57,338,908 | ) |
| | |
| | | |
| | |
| CASH
FLOWS FROM FINANCING ACTIVITIES: | |
| | | |
| | |
| Payment
to redeeming stockholders | |
| (45,952,279 | ) | |
| — | |
| Proceeds
from convertible promissory notes, related party | |
| 1,250,000 | | |
| — | |
| Proceeds
of notes payable – related party | |
| 1,146,784 | | |
| 300,000 | |
| Repayments
of notes payable – related party | |
| — | | |
| (300,000 | ) |
| Issuance
of common stock to founders for cash | |
| — | | |
| 25,000 | |
| Cash
proceeds from sale of Units, net of underwriting discounts paid | |
| — | | |
| 55,905,720 | |
| Cash
proceeds from sale of Private Units | |
| — | | |
| 2,945,980 | |
| Cash
proceeds from issuance of underwriter’s unit purchase option | |
| — | | |
| 100 | |
| Payment
of offering costs | |
| — | | |
| (614,088 | ) |
| Net
cash (used in) provided by financing activities | |
| (43,555,495 | ) | |
| 58,262,712 | |
| | |
| | | |
| | |
| NET
CHANGE IN CASH | |
| 226,351 | | |
| 154,942 | |
| Cash – Beginning
of period | |
| 154,942 | | |
| — | |
| Cash – End
of period | |
$ | 381,293 | | |
$ | 154,942 | |
| | |
| | | |
| | |
| SUPPLEMENTAL
CASH FLOW INFORMATION: | |
| | | |
| | |
| Non-cash
investing and financing activities: | |
| | | |
| | |
| Issuance
of founder shares for related party payables | |
$ | — | | |
$ | 25,000 | |
| Accretion
of common stock to redemption value | |
$ | 6,470,389 | | |
$ | 1,733,440 | |
The
accompanying notes are an integral part of these financial statements.
ABRI
SPAC I, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022 AND FOR THE PERIOD MARCH 18, 2021
(INCEPTION) THROUGH DECEMBER 31, 2021
NOTE
1 — NATURE OF THE ORGANIZATION AND BUSINESS
Abri
SPAC I, Inc (“Abri” or the “Company”) was incorporated in the State of Delaware on March 18, 2021.
The Company’s business purpose is to effect a merger, capital stock exchange, asset acquisition, stock purchase, reorganization
or similar business combination with one or more businesses (our “Initial Business Combination”). Throughout this report,
the terms “our,” “we,” “us,” and the “Company” refer to Abri SPAC I, Inc.
As
of December 31, 2022, and the date of this filing, the Company had not commenced core operations. All activity for the period from
March 18, 2021 (inception) through December 31, 2022 related to organizational activities, those necessary to consummate the
initial public offering (“IPO”) and identify a target company for a business combination. The Company will not generate any
operating revenues until after the completion of the Initial Business Combination, at the earliest. The Company generates non-operating income
in the form of interest income and gains from the marketable securities held in the Trust Account (as defined below), and gains or losses
from the change in fair value of the warrant liabilities.
The
registration statement pursuant to which the Company registered its securities offered in the IPO was declared effective on August 9,
2021. On August 12, 2021, the Company consummated its IPO of 5,000,000 units (each, a “Unit” and collectively,
the “Units”), at $10.00 per Unit, generating gross proceeds of $50,000,000 and incurring offering costs of $973,988.
The Company granted the underwriter a 45-day option to purchase up to an additional 750,000 Units at the IPO price
to cover over-allotments.
Simultaneously
with the consummation of the closing of the Initial Public Offering, the Company completed the private sale of 276,250 units
(the “Private Units”) to Abri Ventures I, LLC (“Abri Ventures”), the Company’s sponsor (the “Sponsor”)
at a purchase price of $10.00 per Private Unit, generating gross proceeds to the Company of $2,762,500.
Following
the closing of the IPO on August 12, 2021, an amount of $50,000,000 net proceeds from the IPO and sale of the Private Units was
placed in a trust account in the United States maintained by Continental Stock Transfer & Trust Company, as trustee (the
“Trust Account”). The funds held in the Trust Account were invested only in U.S. government securities with a maturity
of 180 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company
Act which invest only in direct U.S. government treasury obligations so that we are not deemed to be an investment company under
the Investment Company Act. Except with respect to interest earned on the funds held in the Trust Account, the Trust Account is intended
as a holding place for funds pending the earliest to occur of: (i) the completion of the Initial Business Combination; (ii) the
redemption of any public shares properly submitted in connection with a stockholder vote to amend the Company’s amended and restated
certificate of incorporation (A) to modify the substance or timing of the Company’s obligation to redeem 100% of the
public shares if the Company does not complete the initial Business Combination within 12 months from the closing of the IPO (or
up to 18 months from the closing of this offering with the mandatory extensions of the period of time to consummate an Initial Business
Combination) or (B) with respect to any other provision relating to stockholders’ rights or pre-Initial Business Combination
activity; or (iii) absent an Initial Business Combination within 12 months from the closing of the IPO (or up to 18 months
from the closing of this offering with the mandatory extensions of the period of time to consummate an Initial Business Combination),
the return of the funds held in the Trust Account to the public stockholders as part of redemption of the public shares.
On
August 19, 2021, the underwriters notified the Company of their intent to exercise of the over-allotment option in part and,
on August 23, 2021, the underwriters purchased 733,920 additional Units (the “Additional Units”) at $10.00 per
Additional Unit upon the closing of the over-allotment option, generating additional gross proceeds of $7,339,200. On August 23,
2021, simultaneously with the sale of the Additional Units, the Company consummated the sale of an additional 18,348 Private
Units at $10.00 per additional Private Unit (the “Additional Private Units”), generating additional gross proceeds
of $183,480. A total of $7,339,200 of the net proceeds from the sale of the Additional Units and the Additional Private Units was
deposited in the Trust Account, bringing the aggregate proceeds held in the Trust Account on that date to $57,339,200.
ABRI
SPAC I, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022 AND FOR THE PERIOD MARCH 18, 2021
(INCEPTION) THROUGH DECEMBER 31, 2021
NOTE
1 — NATURE OF THE ORGANIZATION AND BUSINESS (cont.)
The
stock exchange listing rules provide that the Initial Business Combination must be with one or more target businesses that together have
a fair market value equal to at least 80% of the value of the assets held in the Trust Account (as defined below) (excluding the
deferred underwriting commissions and taxes payable) at the time of the Company signing a definitive agreement in connection with the
Initial Business Combination. The Company will only complete an Initial Business Combination if the post-Initial Business Combination
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 (the “Investment Company Act”). There is no assurance that the Company will be able to successfully effect an
Initial Business Combination.
The
payment to the Company’s Sponsor of a monthly fee of $10,000 is for general and administrative services including office space,
utilities and secretarial support, which the Company records as operating expense on its statements of operations. However, pursuant
to the terms of such agreement, we may delay payment of such monthly fee upon a determination by our audit committee that we lack sufficient
funds held outside the trust to pay actual or anticipated expenses in connection with our Initial Business Combination. Any such unpaid
amount will accrue without interest and be due and payable no later than the date of the consummation of our Initial Business Combination.
This arrangement is being agreed to by its Sponsor for our benefit. We believe that the fee charged by our Sponsor is at least as favorable
as we could have obtained from an unaffiliated person. This arrangement will terminate upon completion of our Initial Business Combination
or the distribution of the Trust Account to our public stockholders. Other than the $10,000 per month fee, no compensation of any
kind (including finder’s fees, consulting fees or other similar compensation) will be paid to our insiders, members of our management
team or any of our or their respective affiliates, for services rendered to us prior to or in connection with the consummation of our
Initial Business Combination (regardless of the type of transaction that it is). However, such individuals will receive reimbursement
for any out-of-pocket expenses incurred by them in connection with activities on our behalf, such as identifying potential target
businesses, performing business due diligence on suitable target businesses and business combinations, as well as traveling to and from
the offices, plants or similar locations of prospective target businesses to examine their operations. Since the role of present management
after our Initial Business Combination is uncertain, we have no ability to determine what remuneration, if any, will be paid to those
persons after our Initial Business Combination.
The
funds outside of the Trust Account are for our working capital requirements in searching for our Initial Business Combination. The allocation
such funds represents our best estimate of the intended uses of these funds. If our estimate of the costs of undertaking due diligence
and negotiating our Initial Business Combination is less than the actual amount necessary to do so, 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 our insiders, members of our management team or third parties, but our insiders, members
of our management team or third parties are not under any obligation to advance funds to, or invest in, us.
We
will likely use substantially all of the net proceeds of this offering, including the funds held in the Trust Account, in connection
with our Initial Business Combination and to pay our expenses relating thereto, including the deferred underwriting commissions payable
to the underwriter in an amount equal to 3.0% of the total gross proceeds raised in the offering upon consummation of our Initial
Business Combination. To the extent that our capital stock is used in whole or in part as consideration to effect our Initial Business
Combination, the proceeds held in the Trust Account which are not used to consummate an Initial Business Combination will be disbursed
to the combined company and will, along with any other net proceeds not expended, 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.
ABRI
SPAC I, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022 AND FOR THE PERIOD MARCH 18, 2021
(INCEPTION) THROUGH DECEMBER 31, 2021
NOTE
1 — NATURE OF THE ORGANIZATION AND BUSINESS (cont.)
To
the extent we are unable to consummate an Initial Business Combination, we will pay the costs of liquidation from our remaining assets
outside of the Trust Account. If such funds are insufficient, our insiders have agreed to pay the funds necessary to complete such liquidation
and have agreed not to seek repayment of such expenses.
We
believe that we will not have sufficient available funds to operate for up to the next 12 months, assuming that our Initial Business
Combination is not consummated during that time. However, if necessary, in order to meet our working capital needs following the consummation
of this offering, our insiders may, but are not obligated to, loan us funds, from time to time or at any time, in whatever amount they
deem reasonable in their sole discretion. Each loan would be evidenced by a promissory note. The notes would either be paid upon consummation
of our Initial Business Combination, without interest, or, at the lender’s discretion, up to $750,000 of the notes may be
converted upon consummation of our Initial Business Combination into additional Private Warrants at a price of $1.00 per warrant.
Notwithstanding, there is no guarantee that the Company will receive such funds. Our stockholders have approved the issuance of the Private
Warrants upon conversion of such notes, to the extent the holder wishes to so convert such notes at the time of the consummation of our
Initial Business Combination. If we do not complete an Initial Business Combination, any loans and advances from our insiders or their
affiliates, will be repaid only from amounts remaining outside our Trust Account, if any.
The
Company’s Sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive
their redemption rights with respect to their insider shares and any public shares they may hold in connection with the completion of
our Initial Business Combination. In addition, our Sponsor and its officers and directors have agreed to waive their rights to liquidating
distributions from the Trust Account with respect to their insider shares if we fail to complete our Initial Business Combination within
the prescribed time frame. However, if its Sponsor or any of its officers, directors or affiliates acquire public shares in or after
this offering, they will be entitled to liquidating distributions from the Trust Account with respect to such public shares if we fail
to complete our Initial Business Combination within the prescribed time frame.
The
Company will provide its public stockholders with the opportunity to redeem all or a portion of their shares of common stock upon the
completion of the Initial Business Combination either (i) in connection with a stockholder meeting called to approve the Initial
Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek stockholder approval of
a proposed Initial Business Combination or conduct a tender offer will be made by the Company, solely in the Company’s discretion.
The public stockholders will be entitled to redeem their shares at a per-share price, payable in cash, equal to the aggregate amount
then on deposit in the Trust Account 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 the Company to pay its franchise and income taxes,
divided by the number of then outstanding public shares, subject to the limitations. As of December 31, 2022, the amount in the
Trust Account is approximately $10.25 per public share.
The
shares of common stock subject to redemption was classified as temporary equity upon the completion of the IPO and will subsequently
be accreted to redemption value, in accordance with Financial Accounting Standards Board’s (“FASB”) Accounting Standards
Codification (“ASC”) 480, “Distinguishing Liabilities from Equity”, (“ASC 480”). In such case,
the Company will proceed with an Initial Business Combination if the Company has net tangible assets of at least $5,000,001 upon
such consummation of an Initial Business Combination and, if the Company seeks stockholder approval, a majority of the issued and outstanding
shares voted are voted in favor of the Initial Business Combination.
The
Company had 12 months from the closing of the IPO (the “Combination Period”) on August 9, 2021 to complete the
Initial Business Combination. On August 5, 2022, pursuant to the Company’s amended and restated certificate of incorporation
and investment trust agreement, the Company deposited $573,392 into the Trust Account to extend the time to complete its Initial
Business Combination for an additional three months, or until November 12, 2022. On November 1, 2022, in connection
with a second extension, Abri deposited $573,392 (or $0.10 for each share of common stock issued in the IPO) into the Trust
Account to extend the time to complete a business combination to February 12, 2023. If the
ABRI
SPAC I, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022 AND FOR THE PERIOD MARCH 18, 2021
(INCEPTION) THROUGH DECEMBER 31, 2021
NOTE
1 — NATURE OF THE ORGANIZATION AND BUSINESS (cont.)
Company
is unable to complete its Initial Business Combination within such 18-month period from the closing of the IPO or during any mandatory
extension period, the Company will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably
possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal
to the aggregate amount then on deposit in the Trust Account, including interest earned on the funds held in the Trust Account and not
previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number
of then outstanding public shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including
the right to receive further liquidating distributions, if any), and (iii) as promptly as reasonably possible following such redemption,
subject to the approval of our remaining stockholders and the Company’s 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. There will be no redemption rights or liquidating distributions with respect to the warrants, which will expire worthless if
the Company fails to complete its Initial Business Combination prior to February 12, 2023, unless the Company extends the time to
complete its Initial Business Combination. On February 6, 2023, Abri deposited an additional $87,500 into the Trust Account
to extend the time to complete a business combination to March 12, 2023. On March 10, 2023, Abri deposited an additional $87,500 into
the Trust Account to extend the time to complete a business combination to April 12, 2023.
Trust
Account Redemptions
On
December 9, 2022, the Company held a special meeting of stockholders at which such stockholders voted to amend the Company’s
amended and restated certificate of incorporation and its investment trust agreement, giving the Company the right to extend the date
by which the Company must complete its Initial Business Combination up to six times for an additional one month each time, from February 12,
2023 to August 12, 2023, by depositing $87,500 into the Trust Account for each one-month extension. In connection with the
special meeting, 4,481,548 shares of common stock were tendered for redemption, resulting in redemption payments of $45,952,278
out of the Trust Account. On February 6, 2023, Abri deposited an additional $87,500 into the Trust Account to extend the
time to complete a business combination to March 12, 2023. On March 10, 2023, Abri deposited an additional $87,500 into
the Trust Account to extend the time to complete a business combination to April 12, 2023.
Risks
and Uncertainties
Management
continues to evaluate the impact of the COVID-19 pandemic and Russia-Ukraine war on the economy and the capital markets and
has concluded that, while it is reasonably possible that such events could have negative effects on the Company’s financial position,
results of its operations, and/or search for a target company, the specific impacts are not readily determinable as of the date of these
financial statements. The financial statements do not include any adjustments that might result from the outcome of these uncertainties.
Going
Concern and Management Liquidity Plans
As
of December 31, 2022, the Company had cash of $381,293 and working capital deficiency of $1,921,061. Our liquidity needs through
the date of this filing had been satisfied through proceeds from notes payable and advances from a related party and from the issuance
of common stock. Our liquidity needs consist of paying existing accounts payable, identifying and evaluating prospective business combination
candidates, performing due diligence on prospective target businesses, paying for travel expenditures, selecting the target business
to merge with or acquire, and structuring, negotiating and consummating an Initial Business Combination. Although certain of our initial
stockholders, officers and directors or their affiliates have committed to loan us funds from time to time or at any time, in whatever
amount they deem reasonable in their sole discretion, there is no guarantee that we will receive such funds.
Accordingly,
the accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States
of America (“U.S. GAAP”), which contemplate continuation of the Company as a going concern and the realization of assets
and the satisfaction of liabilities in the normal course
ABRI
SPAC I, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022 AND FOR THE PERIOD MARCH 18, 2021
(INCEPTION) THROUGH DECEMBER 31, 2021
NOTE
1 — NATURE OF THE ORGANIZATION AND BUSINESS (cont.)
of
business. These financial statements do not include any adjustments that might result from the outcome of this uncertainty. Further,
we have incurred and expect to continue to incur significant costs in pursuit of our financing and acquisition plans. Management plans
to address this uncertainty during period leading up to the Initial Business Combination. The Company cannot provide any assurance that
its plans to raise capital or to consummate an Initial Business Combination will be successful. Based on the foregoing, management believes
that the Company will not have sufficient working capital and borrowing capacity to meet its needs through the earlier of the consummation
of the Initial Business Combination or one year from this filing. These factors, among others, raise substantial doubt about our ability
to continue as a going concern.
NOTE
2 — ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis
of Presentation
The
accompanying audited financial statements have been prepared in accordance with U.S. GAAP and in accordance with the rules and regulations
of the Securities and Exchange Commission (the “SEC”). The summary of significant accounting policies presented below is
designed to assist in understanding the Company’s financial statements. Such consolidated financial statements and accompanying
notes are the representations of the Company’s management, who is responsible for their integrity and objectivity.
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. 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 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 which is neither an emerging growth
company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of
the potential differences in accounting standards used.
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 at the date of the financial
statements and the reported amounts of revenues and expenses during the reporting period. Making estimates requires management to exercise
significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances
that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near
term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates.
Cash
and cash equivalents
The
Company considers all short-term investments outside of the Trust Account with an original maturity of three months or less
when purchased to be cash equivalents. The Company did not have any cash equivalents as of December 31, 2022 or 2021.
ABRI
SPAC I, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022 AND FOR THE PERIOD MARCH 18, 2021
(INCEPTION) THROUGH DECEMBER 31, 2021
NOTE
2 — ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
Marketable
Securities Held in Trust Account
The
Company has marketable securities held in the Trust Account consisting of securities held in a money market fund that invests in U. S.
governmental securities with a maturity of 180 days or less which meet certain conditions under Rule 2a-7 under the
Investment Company Act. Marketable securities held in the Trust Account are classified as trading securities. Trading securities are
presented on the balance sheets at fair value at the end of each reporting period. Gains and losses resulting from the change in fair
value of these securities is included in interest income in the consolidated statements of operations. The estimated fair values of the
investments held in the Trust Account are determined using available market information. During the year ended December 31, 2022,
the Company withdrew $400,000 of interest income from the Trust Account to pay its tax obligations. There was no withdrawal from
the Trust Account during the period from March 18, 2021 (inception) to December 31, 2021.
Offering
Costs
Offering
costs consist of professional fees, filing, regulatory and other costs incurred through the balance sheet date that are directly related
to the IPO. Offering costs are charged against the carrying value of the ordinary shares or the statements of operations based on
the relative value of the common shares and the Public Warrants to the proceeds received from the Units sold upon the completion
of the IPO. Accordingly, on August 12, 2021, offering costs in the aggregate of $973,988 were recognized (including $359,900 for
the fair value of the Representative’s unit purchase option), all of which was allocated to the common shares, reducing the carrying
amount of such shares as of such date.
Warrant
Liabilities
The
Company accounts for the Private Warrants in accordance with the guidance contained in ASC 480, under which the Private
Warrants do not meet the criteria for equity treatment and must be recorded as derivative liabilities. Accordingly, upon issuance, the
Company will classify the Private Warrants as liabilities at their fair value and will adjust the Private Warrants to fair value at each
reporting period. These liabilities are subject to re-measurement at each balance sheet date until the Private Warrants are exercised
or expire, and any change in fair value is recognized in the Company’s statements of operations. The fair value of the Private
Warrants will be initially and subsequently measured at the end of each reporting period using a Black-Scholes option pricing model.
The
Company’s Public Warrants were accounted for and are presented as equity and measured using a Monte Carlo simulation model.
Common
Stock Subject to Possible Redemption
The
Company accounts for its common stock subject to possible redemption in accordance with the guidance in ASC 480. Common stock subject
to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock
(including common stock that feature redemption rights that is either within the control of the holder or subject to redemption upon
the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times,
common stock is classified as stockholders’ equity. The Company’s common stock features certain redemption rights that are
considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, common stock
subject to possible redemption will be presented at redemption value and as temporary equity, outside of the stockholders’ equity
(deficit) section of the Company’s balance sheets.
The
Company has made a policy election in accordance with ASC 480 and will accrete changes in redemption value in additional paid-in capital
(or accumulated deficit in the absence of additional paid-in capital) through the time period to complete the Initial Business Combination.
In connection with a redemption of shares, any unrecognized accretion will be fully recognized for shares that are redeemed. As of December 31,
2022, the Company had recorded accretion of $8,203,829, with no unrecognized accretion. As of December 31, 2021, the Company
had recorded accretion of $1,733,440 with unrecognized accretion of $5,015,911.
ABRI
SPAC I, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022 AND FOR THE PERIOD MARCH 18, 2021
(INCEPTION) THROUGH DECEMBER 31, 2021
NOTE
2 — ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
Income
Taxes
The
Company follows the asset and liability method of accounting for income taxes under ASC 740, Income Taxes. Deferred
tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial
statement carrying amounts of existing assets and liabilities 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.
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. The Company recognizes accrued interest and penalties related to unrecognized tax benefits
as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of December 31,
2022 and 2021. The Company is currently not aware of any 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 taxing authorities since inception.
Concentration
of Credit Risk
Financial
instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution,
which, at times, may exceed the Federal Depository Insurance Coverage. As of December 31, 2022 and 2021, the Company has not experienced
losses on this account and management believes the Company is not exposed to significant risks on such account.
Fair
Value of Financial Instruments
The
fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC 820, Fair Value
Measurement, approximates the carrying amounts represented in the accompanying balance sheet, primarily due to their short-term nature.
Fair
Value Measurements
Fair
value is defined as the price that would be received for sale of an asset or paid for transfer of a liability, in an orderly transaction
between market participants at the measurement date. U.S. GAAP establishes a three-tier fair value hierarchy, which prioritizes
the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical
assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers include:
| · | Level 1,
defined as observable inputs such as quoted prices (unadjusted) for identical instruments
in active markets; |
| · | Level 2,
defined as inputs other than quoted prices in active markets that are either directly or
indirectly observable such as quoted prices for similar instruments in active markets or
quoted prices for identical or similar instruments in markets that are not active; and |
| · | Level 3,
defined as unobservable inputs in which little or no market data exists, therefore requiring
an entity to develop its own assumptions, such as valuations derived from valuation techniques
in which one or more significant inputs or significant value drivers are unobservable. |
ABRI
SPAC I, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022 AND FOR THE PERIOD MARCH 18, 2021
(INCEPTION) THROUGH DECEMBER 31, 2021
NOTE
2 — ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
In
some circumstances, the inputs used to measure fair value might be categorized within different levels of the fair value hierarchy. In
those instances, the fair value measurement is categorized in its entirety in the fair value hierarchy based on the lowest level input
that is significant to the fair value measurement.
Derivative
Financial Instruments
The
Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded
derivatives in accordance with ASC 815, Derivatives and Hedging. For derivative financial instruments that are accounted
for as liabilities, the derivative instrument is initially recorded at its fair value on the issuance date and is then re-valued at
each reporting date, with changes in the fair value reported in the statements of operations. The classification of derivative instruments,
including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period.
Derivative liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement
or conversion of the instrument could be required within 12 months of the balance sheet date.
Net
Loss Per Share
Net
loss per share is computed by dividing net loss by the weighted average number of common shares outstanding during the reporting period.
Diluted earnings per share is computed similar to basic earnings per share, except the weighted average number of common shares outstanding
are increased to include additional shares from the assumed exercise of share options, if dilutive. All outstanding convertible notes
are considered common stock at the beginning of the period or at the time of issuance, if later, pursuant to the if-converted method.
Since the effect of common stock equivalents is anti-dilutive with respect to losses, the shares issuable upon conversion have been
excluded from the Company’s computation of net loss per common share for the year ended December 31, 2022.
The
following table summarizes the securities that would be excluded from the diluted per share calculation because the effect of including
these potential shares was antidilutive due to the Company’s net loss position, even though the exercise price could be less than
the most recent fair value of the common shares:
| | |
As
of December 31, 2022 | |
| Potential
shares from convertible debt | |
| 125,000 | |
| Total | |
| 125,000 | |
The
Company complies with accounting and disclosure requirements of ASC 260, “Earnings Per Share”. The statements
of operations include a presentation of income (loss) per redeemable share and income (loss) per non-redeemable share following
the two-class method of income per share. In order to determine the Net income (loss) attributable to both the redeemable shares
and non-redeemable shares, the Company first considered the total income (loss) allocable to both sets of shares. This is calculated
using the total net income (loss) less any dividends paid. For purposes of calculating net income (loss) per share, any remeasurement
of the ordinary shares subject to possible redemption was considered to be dividends paid to holders of redeemable common stock. For
the year ended December 31, 2022, this had an antidilutive effect on earnings per share for the non-redeemable shares. Therefore,
the Company did not allocate any portion of the loss to the redeemable shares subject to redemption.
For
the year ended December 31, 2022, the net loss per share included within the statements of operations is based on the following:
| Net
loss | |
$ | (2,500,184 | ) |
| Less:
Accretion of temporary equity to redemption value | |
| (6,470,389 | ) |
| Net
loss including accretion of temporary equity to redemption value | |
$ | (8,970,573 | ) |
ABRI SPAC I, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022 AND FOR THE PERIOD MARCH 18, 2021
(INCEPTION) THROUGH DECEMBER 31, 2021
NOTE 2 — ORGANIZATION
AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
| | |
Common
Shares
Subject to
Redemption | | |
Non-redeemable
Common
Shares | |
| Basic and diluted net loss per share: | |
| | | |
| | |
| Numerator: | |
| | | |
| | |
| Allocation of net loss including accretion of temporary equity | |
$ | (6,815,107 | ) | |
$ | (2,155,466 | ) |
| Accretion of temporary equity to redemption value | |
| 6,470,389 | | |
| — | |
| Allocation of net loss | |
$ | (344,718 | ) | |
| (2,155,466 | ) |
| | |
| | | |
| | |
| Denominator: | |
| | | |
| | |
| Weighted-average shares outstanding | |
| 5,463,799 | | |
| 1,728,078 | |
| Basic and diluted net loss per share | |
$ | (0.06 | ) | |
$ | (1.25 | ) |
For the
period from March 18, 2021 (inception) to December 31, 2021, the net loss per share included within the statements of operations
is based on the following:
For the period
from March 18, 2021 (inception) through December 31, 2021
| Net loss | |
$ | (1,127,612 | ) |
| Accretion of temporary equity to redemption value | |
| (1,733,440 | ) |
| Net loss including accretion of temporary equity to redemption value | |
$ | (2,861,052 | ) |
| | |
Common
Shares
Subject to
Redemption | | |
Non-redeemable
Common
Shares | |
| Basic and diluted net income (loss) per share: | |
| | | |
| | |
| Numerator: | |
| | | |
| | |
| Allocation of net loss including accretion of temporary equity | |
$ | (2,157,043 | ) | |
$ | (704,009 | ) |
| Accretion of temporary equity to redemption value | |
| 1,733,440 | | |
| — | |
| Allocation of net loss | |
$ | (423,603 | ) | |
$ | (704,009 | ) |
| | |
| | | |
| | |
| Denominator: | |
| | | |
| | |
| Weighted-average shares outstanding | |
| 2,789,393 | | |
| 1,447,964 | |
| Basic and diluted net loss per share | |
$ | (0.15 | ) | |
$ | (0.49 | ) |
In connection
with the underwriters’ exercise of the over-allotment option on August 19, 2021, a total of 187,500 Founder
Shares were no longer subject to forfeiture. These shares were excluded from the calculation of weighted average shares outstanding until
they were no longer subject to forfeiture.
At December 31,
2022 and 2021, any securities and other contracts that could, potentially, be exercised or converted into ordinary shares would be antidilutive
due to the Company’s loss position. As a result, diluted loss per share is the same as basic loss per share for the periods presented.
Recent Accounting Pronouncements
Management
does not believe that any recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material
effect on the Company’s financial statements.
ABRI SPAC I, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022 AND FOR THE PERIOD MARCH 18, 2021
(INCEPTION) THROUGH DECEMBER 31, 2021
NOTE 3 — INITIAL
PUBLIC OFFERING
On August 12,
2021, the Company consummated its IPO of 5,000,000 Units at $10.00 per Unit, generating gross proceeds of $50,000,000 and
incurred offering costs of $2,223,988, consisting of $1,250,000 of underwriting fees and expenses and $973,988 of costs related
to the IPO. Additionally, the Company recorded deferred underwriting commissions of $1,500,000 (increasing up to $1,725,000 if
the underwriter’s over-allotment option is exercised in full) payable only upon completion of our Initial Business Combination.
Simultaneously
with the consummation of the closing of the IPO, the Company completed the private sale of 276,250 Private Units to its
Sponsor at a purchase price of $10.00 per Private Unit, generating gross proceeds to the Company of $2,762,500.
On August 19,
2021, the underwriters notified the Company of their intent to exercise of the over-allotment option in part and, on August 23,
2021, the underwriters purchased 733,920 Additional Units at $10.00 per Additional Unit upon the closing of the over-allotment option,
generating additional gross proceeds of $7,339,200. On August 23, 2021, simultaneously with the sale of the Additional Units, the
Company consummated the sale of an additional 18,348 Additional Private Units, generating additional gross proceeds of $183,480.
A total of $7,339,200 of the net proceeds from the sale of the Additional Units and the Additional Private Units was deposited
in the Trust Account.
Since
the underwriters did not exercise their over-allotment option in full, 4,020 shares of common stock issued to the sponsor
prior to the IPO and the Private Placement, were forfeited for no consideration.
The Private
Units were issued pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended, as the transactions
did not involve a public offering.
NOTE 4 — RELATED
PARTY TRANSACTIONS
Sponsor Shares
On April 12,
2021, the Company’s sponsor, Abri Ventures purchased 1,437,500 shares (the “Founder Shares”) of the Company’s
common stock for an aggregate price of $25,000.
Private Units
On August 12,
2021, our Sponsor purchased an aggregate of 276,250 Private Units in a private placement that closed simultaneously with
the closing of IPO. The Private Units are comprised of one share of common stock and one redeemable warrant, each exercisable
to purchase one share of common stock at $11.50 per share and are otherwise identical to the public warrants in the IPO.
On August 23,
2021, simultaneously with the sale of the Additional Units, the Company consummated the sale of an additional 18,348 Additional
Private Units, generating additional gross proceeds of $183,480.
All of
the proceeds we received from this private placement of units were added to the proceeds from the IPO to pay for the expenses of the IPO
and to be held in the Trust Account. If we do not complete our Initial Business Combination within 12 months from the closing of
this IPO (or up to 18 months), the proceeds of the sale of the Private Units will be used to fund the redemption of our public
shares (subject to the requirements of applicable law) and the Private Units and underlying warrants will be worthless.
Promissory Note — Related
Party
On April 20,
2021, the Company entered a promissory note with its Sponsor for principal amount received of $300,000 to be used for a portion of
the expenses of the IPO. The note was non-interest bearing, unsecured and payable on the earlier of: (i) December 31,
2022 or (ii) the date on which the Company consummated the IPO. As of December 31, 2022, there was a zero balance outstanding
under the note.
ABRI SPAC I, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022 AND FOR THE PERIOD MARCH 18, 2021
(INCEPTION) THROUGH DECEMBER 31, 2021
NOTE 4 — RELATED
PARTY TRANSACTIONS (cont.)
On August 5,
2022, the Company entered a promissory note with its Sponsor of principal amount received of $573,392 to extend the time available
for the company to consummate its initial business combination. The note was non-interest bearing, unsecured and payable on the date
the Company consummates an Initial Business Combination.
On November 1,
2022, the Company entered a promissory note with its Sponsor of principal amount received of $573,392 to extend the time available
for the company to consummate its initial business combination. The note was non-interest bearing, unsecured and payable on the date
the Company consummates an Initial Business Combination.
In the
event that an Initial Business Combination does not close prior to April 12, 2023 (or later if the period of time to consummate an
Initial Business Combination is extended), both notes shall be deemed terminated and no amounts will be owed. As of December 31,
2022, there was $1,146,784 outstanding in the aggregate under both notes.
Convertible Promissory
Notes — Related Party
On March 8,
2022, the Company entered a convertible promissory note with its Sponsor for principal amount received of $300,000 to be used for
a portion of the expenses of the IPO. The note was non-interest bearing, unsecured and payable on the date the Company consummates
a Business Combination. In the event that a Business Combination did not close prior to April 12, 2023 (or up to later if the period
of time to consummate an Initial Business Combination is extended), the note shall be deemed terminated and no amounts will be owed. At
any time, up to a day prior to the closing of an Initial Business Combination, the holder may convert the principal amount into private
units of the Company at a conversion price of $10.00 per unit. As of December 31, 2022, there was $300,000 outstanding
under the note.
On April 4,
2022, the Company entered a convertible promissory note with its Sponsor of principal amount received of $500,000 to be used for
operating expenses. The note was non-interest bearing, unsecured and payable on the date the Company consummates a Business Combination.
In the event that a Business Combination did not close prior to August 12, 2022 (or up to February 12, 2023, if the period of
time to consummate an Initial Business Combination is extended), the note shall be deemed terminated and no amounts will be owed. At any
time, up to a day prior to the closing of an Initial Business Combination, the holder may convert the principal amount into private
units of the Company at a conversion price of $10.00 per unit. As of December 31, 2022, there was $500,000 outstanding
under the note.
On August 26,
2022, the Company entered a convertible promissory note with its Sponsor of principal amount received of $300,000 to be used for
operating expenses. The note was non-interest bearing, unsecured and payable on the date the Company consummates an Initial Business
Combination. In the event that an Initial Business Combination does not close prior to February 12, 2023 (or up to August 12,
2023, if the period of time to consummate an Initial Business Combination is extended), the note shall be deemed terminated and no amounts
will be owed. At any time, up to a day prior to the closing of an Initial Business Combination, the holder may convert the principal
amount into private units of the Company at a conversion price of $10.00 per unit. As of December 31, 2022, there was $300,000 outstanding
under the note.
On November 22,
2022, the Company entered a convertible promissory note with its Sponsor of principal amount received of $150,000 to be used for
operating expenses. The note was non-interest bearing, unsecured and payable on the date the Company consummates an Initial Business
Combination. In the event that an Initial Business Combination does not close prior to February 12, 2023 (or up to August 12,
2023, if the period of time to consummate an Initial Business Combination is extended), the note shall be deemed terminated and no amounts
will be owed. At any time, up to a day prior to the closing of an Initial Business Combination, the holder may convert the principal
amount into private units of the Company at a conversion price of $10.00 per unit. As of December 31, 2022, there was $150,000 outstanding
under the note.
ABRI SPAC I, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022 AND FOR THE PERIOD MARCH 18, 2021
(INCEPTION) THROUGH DECEMBER 31, 2021
NOTE 4 — RELATED
PARTY TRANSACTIONS (cont.)
Administrative and Support
Services
The Company
entered into an administrative services agreement pursuant to which the Company will pay the Sponsor a total of $10,000 per month
for office space, administrative and support services, which the Company records as operating expense on its statements of operations.
Upon the completion of the Initial Business Combination or our liquidation, the Company will cease paying these monthly fees. The Company
recorded $120,000 and $90,000 related to these fees during the year ended December 31, 2022 and the period from March 18,
2021 (inception) to December 31, 2021, respectively. As of December 31, 2022 and 2021, the Company owed the Sponsor $10,000 and zero,
respectively, under this agreement.
NOTE 5 — COMMITMENTS
AND CONTINGENCIES
Merger Agreement and Termination
with Apifiny
On January 27,
2022, the Company entered into a Merger Agreement (the “Merger Agreement”) by and among Apifiny Group Inc., a Delaware corporation
(“Apifiny”), the Company, Abri Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of the Company (“Merger
Sub”), Erez Simha, solely in his capacity as representative, agent and attorney-in-fact of the Apifiny security holders, and
the Sponsor, solely in its capacity as representative, agent and attorney-in-fact of the Indemnified Party (as defined in the Merger
Agreement) (collectively, the “Parties”).
On July 22,
2022, the Parties entered into a termination of merger letter agreement (the “Termination Agreement”). Pursuant to the Termination
Agreement, the Parties agreed to mutually terminate the Merger Agreement, subject to the representations, warranties, conditions and covenants
set forth in the Termination Agreement. In conjunction with the termination of the Merger Agreement, the Additional Agreements (as defined
in the Merger Agreement) (including the Parent and Company Stockholder Support Agreements) have also been terminated in accordance with
their respective terms as of July 22, 2022.
The Termination
Agreement contains mutual releases by all parties thereto, for all claims known and unknown, relating and arising out of, or relating
to, among other things, the Merger Agreement, or the transactions contemplated by the Merger Agreement, subject to certain exceptions
with respect to claims for indemnity or contribution.
Merger Agreement with
DLQ
On September 9,
2022, the Company, entered into a Merger Agreement (the “Merger Agreement”) by and among Abri Merger Sub, Inc., a Delaware
corporation and a wholly owned subsidiary of Abri (“Merger Sub”), Logiq, Inc., a Delaware corporation (“DLQ Parent”)
whose common stock is quoted on the OTCQX Market under the ticker symbol, “LGIQ”, and DLQ, Inc., a Nevada corporation (“DLQ”)
and wholly owned subsidiary of DLQ Parent. Pursuant to the terms of the Merger Agreement, a business combination between the Company and
DLQ will be effected through the merger of Merger Sub with and into DLQ, with DLQ surviving the merger as a wholly owned subsidiary of
the Company (the “Merger”). The board of directors of the Company has (i) approved and declared advisable the Merger
Agreement, the Additional Agreements (as defined in the Merger Agreement) and the transactions contemplated thereby and (ii) resolved
to recommend approval of the Merger Agreement and related transactions by the stockholders of the Company.
The Merger
is expected to be consummated after obtaining the required approval by the stockholders of the Company, DLQ and DLQ Parent and the satisfaction
of certain other customary closing conditions.
The total
consideration to be paid at Closing (the “Merger Consideration”) by the Company to DLQ security holders will be an amount
equal to $114,000,000. The Merger Consideration will be payable in shares of common stock, par value $0.0001 per share, of the Company
(“Abri Common Stock”).
ABRI SPAC I, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022 AND FOR THE PERIOD MARCH 18, 2021
(INCEPTION) THROUGH DECEMBER 31, 2021
NOTE 5 — COMMITMENTS
AND CONTINGENCIES (cont.)
DLQ Management Earnout
Agreement
In connection
with the execution of the Merger Agreement, Abri and the Sponsor will enter into a management earnout agreement (the “Management
Earnout Agreement”), pursuant to which certain members of the management team of DLQ (the “Management”) will
have the contingent right to earn the Management Earnout Shares (as defined in the Management Earnout Agreement). The Management Earnout
Shares consist of 2,000,000 shares of Abri Common Stock (the “Management Earnout Shares”). The release of the Management
Earnout Shares shall occur as follows:
| |
· |
500,000 Management Earnout Shares will be earned and released upon satisfaction of the First Milestone Event (as defined in the Management Earnout Agreement); |
| |
· |
650,000 Management Earnout Shares will be earned and released upon satisfaction of the Second Milestone Event (as defined in the Management Earnout Agreement); and |
| |
· |
850,000 Management Earnout Shares will be earned and released upon satisfaction of the Third Milestone Event (as defined in the Management Earnout Agreement). |
If the
Company has not consummated an initial business combination by April 12, 2023 (or up to August 12, 2023 if the time period to
consummate the Initial Business Combination is extended), the Company will be required to dissolve and liquidate. If the Company anticipates
that it may not be able to consummate its initial business combination on or before April 12, 2023, the Company may, but is not obligated
to, extend the period of time to consummate an Initial Business Combination, for another four times by an additional one month each
time through August 12, 2023.
Registration Rights
The holders
of the Founder Shares are entitled to registration rights pursuant to a registration rights agreement that was signed as of the effective
date of the IPO. The holders of the majority of these securities are entitled to make up to three demands that the Company register
such securities. The holders of the majority of the Founder Shares can elect to exercise these registration rights at any time commencing
three months prior to the date on which the Founder Shares 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 our Initial
Business Combination. The holders of the Founder Shares have agreed not to transfer, assign or sell any of the such shares (except to
certain permitted transferees) until, with respect to 50% of such shares, the earlier of six months after the date of the consummation
of our Initial Business Combination and the date on which the closing price of our common stock equals or exceeds $12.50 per share
for any 20 trading days within a 30-trading day period following the consummation of our Initial Business Combination and, with
respect to the remaining 50% of such shares, six months after the date of the consummation of our Initial Business Combination, or
earlier in each case if, subsequent to our Initial Business Combination, we complete a liquidation, merger, stock exchange or other similar
transaction which results in all of our stockholders having the right to exchange their shares of common stock for cash, securities or
other property. The Founder Shares will be held in escrow with Continental Stock Transfer & Trust Company during the period in
which they are subject to the transfer restrictions described above.
Unit Purchase Option
We sold
to the underwriters, for $100, an option to purchase up to a total of 300,000 units (increased to 344,035 units after
the over-allotment was exercised in part) exercisable, in whole or in part, at $11.50 per unit, commencing on the consummation
of our Initial Business Combination. The purchase option may be exercised for cash or on a cashless basis, at the holder’s option,
and expires five years from the commencement of sales in this offering. The option and the 300,000 units, as well
as the 300,000 shares of common stock, and the warrants to purchase 300,000 shares of common stock that may be issued
upon exercise of the option, have been deemed compensation by FINRA and are therefore subject to a lock-up for a period of 180 days
immediately following the
ABRI SPAC I, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022 AND FOR THE PERIOD MARCH 18, 2021
(INCEPTION) THROUGH DECEMBER 31, 2021
NOTE 5 — COMMITMENTS
AND CONTINGENCIES (cont.)
effective date of the registration
statement or the commencement of sales in the IPO pursuant to Rule 5110(e)(1) of FINRA’s Rules, during which time the
option may not be sold, transferred, assigned, pledged or hypothecated, or be subject of any hedging, short sale, derivative or put or
call transaction that would result in the economic disposition of the securities. Additionally, the option may not be sold, transferred,
assigned, pledged or hypothecated for a one-year period (including the foregoing 180-day period) following the date of the Company’s
initial prospectus except to any underwriter and selected dealer participating in the offering and their bona fide officers or partners.
The option grants to holders demand and “piggy-back” rights of the securities directly and indirectly issuable upon exercise
of the option. Notwithstanding the foregoing, the underwriters and their related persons may not (i) have more than one demand
registration right at our expense, (ii) exercise their demand registration rights more than five (5) years from the effective
date of the registration statement, and (iii) exercise their “piggy-back” registration rights more than seven (7) years
from the effective date of the registration statement. We will bear all fees and expenses attendant to registering the securities,
other than underwriting commissions which will be paid for by the holders themselves. The exercise price and number of units issuable
upon exercise of the option may be adjusted in certain circumstances including in the event of a stock dividend, or our recapitalization,
reorganization, merger or consolidation. However, the option will not be adjusted for issuances of shares of common stock at a price below
its exercise price. We will have no obligation to net cash settle the exercise of the purchase option or the warrants underlying the purchase
option. The holder of the purchase option will not be entitled to exercise the purchase option or the warrants underlying the purchase
option unless a registration statement covering the securities underlying the purchase option is effective or an exemption from registration
is available. If the holder is unable to exercise the purchase option or underlying warrants, the purchase option or warrants, as applicable,
will expire worthless.
On August 12,
2021, the Company accounted for the unit purchase option, inclusive of the receipt of $100 cash payment, as an expense of the Initial
Public Offering resulting in a charge directly to stockholders’ equity.
NOTE 6 — STOCKHOLDERS’
EQUITY (DEFICIT)
Common Stock
The Company
is authorized to issue an aggregate of 5,000,000 shares of common stock having a par value of $0.0001 per share. On April 12,
2021, the Company issued 1,437,500 founder shares of common stock at a price of $0.0001 per share for total receivable
of $25,000. These Founder Shares held by our Sponsor included up to 187,500 shares which were subject to forfeiture by the stockholder
if the underwriters of the Company’s IPO did not fully or in part exercise their over-allotment option. On August 19,
2021, the underwriters notified the Company of their intent to exercise of the over-allotment option in part and, on August 23,
2021, the underwriters purchased 733,920 Additional Units at $10.00 per Additional Unit upon the closing of the over-allotment option,
generating additional gross proceeds of $7,339,200. On August 23, 2021, simultaneously with the sale of the Additional Units, the
Company consummated the sale of an additional 18,348 Additional Private Units, generating additional gross proceeds of $183,480.
The balance of the Additional Private Units, or 402 Private Units, including 4,020 Founder Shares, were forfeited by the Sponsor.
Authorized Stock
Upon the
effectiveness of the Company’s registration statement on August 9, 2021, the Company amended and restated its certificate of
incorporation to authorize the issuance of up to 100,000,000 shares of common stock, par value $0.0001 per share, and 1,000,000 shares
of preferred stock, par value $0.0001 per share.
ABRI SPAC I, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022 AND FOR THE PERIOD MARCH 18, 2021
(INCEPTION) THROUGH DECEMBER 31, 2021
NOTE 6 — STOCKHOLDERS’
EQUITY (DEFICIT) (cont.)
Public and Private Warrants
Each whole
warrant entitles the registered holder to purchase one common stock at a price of $11.50 per share, subject to adjustment as discussed
below, at any time commencing on the later of the completion of an Initial Business Combination and one year from the consummation
of the Company’s IPO. The warrants will expire five years after the completion of our Initial Business Combination,
or earlier upon redemption.
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. It is our current intention to 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 in effect promptly following consummation of an Initial Business Combination. Notwithstanding the foregoing, if
a registration statement covering the shares of common stock issuable upon exercise of the public warrants is not effective within 90 days
following the consummation of our Initial Business Combination, public 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.
We may
redeem the outstanding warrants, in whole and not in part, at a price of $0.01 per warrant:
| |
· |
at any time while the warrants are exercisable; |
| |
· |
upon a minimum of 30 days’ prior written notice of redemption; |
| |
· |
if, and only if, the last sales price of our shares of common stock equals or exceeds $16.50 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. |
If the
foregoing conditions are satisfied and we issue a notice of redemption, each warrant holder can exercise his, her or its warrant prior
to the scheduled redemption date. However, the price of the shares of common stock may fall below the $16.50 trigger price as well
as the $11.50 warrant exercise price per share after the redemption notice is issued and not limit our ability to complete the redemption.
The redemption
criteria for our warrants have been established at a price which 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 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.
ABRI SPAC I, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022 AND FOR THE PERIOD MARCH 18, 2021
(INCEPTION) THROUGH DECEMBER 31, 2021
NOTE 6 — STOCKHOLDERS’
EQUITY (DEFICIT) (cont.)
Common Stock Subject to
Redemption
The Company’s
common stock feature certain redemption rights that are considered to be outside of the Company’s control and subject to the occurrence
of future events. The Company is authorized to issue 100,000,000 shares of common stock with a par value of $0.0001 per
share. Holders of the Company’s common stock are entitled to one vote for each share. As of December 31, 2022 and
2021, there were 1,252,372 and 5,733,920 shares of common stock outstanding, respectively, subject to possible redemption
and are classified outside of permanent equity in the balance sheets.
The balances
of common stock subject to possible redemption reflected on the balance sheets are reconciled in the following table:
| Gross proceeds from IPO | |
$ | 57,339,200 | |
| Less: | |
| | |
| Fair value of public warrants at issuance | |
| (3,201,883 | ) |
| Offering Costs allocated to common stock subject to possible redemption | |
| (3,547,468 | ) |
| Plus: | |
| | |
| Accretion of common stock subject to possible redemption | |
| 1,733,440 | |
| Common stock subject to possible redemption as of December 31, 2021 | |
| 52,323,289 | |
| Plus: | |
| | |
| Accretion of common stock subject to possible redemption | |
| 6,332,332 | |
| Less: | |
| | |
| Common stock redeemed on December 19, 2022 | |
| (45,952,279 | ) |
| Common stock subject to possible redemption as of December 31, 2022 | |
$ | 12,703,342 | |
During
the year ended December 31, 2022 and the period from March 18, 2021 (inception) to December 31, 2021, there was accretion
cost recorded in the statements of stockholders’ equity (deficit) and redeemable common stock of $6,332,332 and $1,733,440, respectively.
NOTE 7 — WARRANTS
On August 12,
2021, the Company consummated its IPO of 5,000,000 Units at $10.00 per Unit, generating gross proceeds of $50,000,000,
with each Unit consisting of one share of common stock, $0.0001 par value, and one redeemable warrant. The Company granted the underwriter
a 45-day option to purchase up to an additional 750,000 Units at the IPO price to cover over-allotments.
Simultaneously
with the consummation of the closing of the IPO, the Company completed the private sale of 276,250 Private Units to its
Sponsor at a purchase price of $10.00 per Private Unit, generating gross proceeds to the Company of $2,762,500, with each Private
Unit consisting of one share of common stock, $0.0001 par value, and one redeemable warrant.
Upon consummation
of our IPO, we sold to the underwriters, for $100, an option to purchase up to a total of 300,000 units (increased to 344,035 units
after the over-allotment was exercised in part) exercisable, in whole or in part, at $11.50 per unit, commencing on the consummation
of our Initial Business Combination. The purchase option may be exercised for cash or on a cashless basis, at the holder’s option,
and expires five years from the commencement of sales in this offering. The option and the 300,000 units, as well
as the 300,000 shares of common stock, and the warrants to purchase 300,000 shares of common stock that may be issued
upon exercise of the option have been deemed compensation by FINRA and are therefore subject to a lock-up for a period of 180 days
immediately following the effective date of our registration statement, or August 9, 2021. As of August 12, 2021, the Company
accounted for the unit purchase option, inclusive of the receipt of $100 cash payment, as an expense of the IPO resulting in a charge
directly to stockholders’ equity.
ABRI SPAC I, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022 AND FOR THE PERIOD MARCH 18, 2021
(INCEPTION) THROUGH DECEMBER 31, 2021
NOTE 7 — WARRANTS (cont.)
On August 19,
2021, the underwriters notified the Company of their intent to exercise of the over-allotment option in part and, on August 23,
2021, the underwriters purchased 733,920 Additional Units at $10.00 per Additional Unit upon the closing of the over-allotment option,
generating additional gross proceeds of $7,339,200. On August 23, 2021, simultaneously with the sale of the Additional Units, the
Company consummated the sale of an additional 18,348 Additional Private Units, generating additional gross proceeds of $183,480,
with each Additional Private Unit consisting of one share of common stock, $0.0001 par value, and one redeemable warrant.
On April 13,
2022, the Company and Continental Stock Transfer & Trust Company (the “Warrant Agent”), entered into a supplement
(the “Supplement to Warrant Agreement”) to the Warrant Agreement, dated as of August 9, 2021 by and between the Company
and the Warrant Agent in connection with the Company’s IPO (see Note 3). The Supplement to Warrant Agreement clarifies that
the lock-up period for the Private Warrants extends to 30 days after the completion of the Company’s Initial Business
Combination.
Each Private
Unit, Additional Unit and Additional Private Unit are identical to the Unit from our IPO except as described below.
The Sponsor
has agreed to waive its redemption rights with respect to any shares underlying the Private Units (i) in connection with the
consummation of a business combination, (ii) in connection with a stockholder vote to amend our amended and restated certificate
of incorporation 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, to redeem 100% of our public shares if we do not complete our Initial Business Combination
within 12 months from the completion of this offering (or up to 18 months from the closing of this offering if extended) or
with respect to any other provision relating to stockholders’ rights or pre-Initial Business Combination activity and (iii) if
we fail to consummate a business combination within 12 months from the completion of this offering (or up to 18 months from
the closing of this offering if extended) or if we liquidate prior to the expiration of the 18 month period. However, the Sponsor
will be entitled to redemption rights with respect to any public shares it holds if we fail to consummate a business combination or liquidate
within the 18-month period.
The Private
Units and their component securities will not be transferable, assignable or saleable until 30 days after the consummation of
our Initial Business Combination except to permitted transferees.
The Company
evaluated the Public and Private Warrants as either equity-classified or liability-classified instruments based on an assessment
of the warrants’ specific terms and ASC 480 and ASC 815. The assessment considers whether the warrants are freestanding
financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants
meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s
own common stock, among other conditions for equity classification. Pursuant to such evaluation, the Company further evaluated the Public
and Private Warrants under ASC 815-40, “Derivatives and Hedging — Contracts in Entity’s Own Equity”
and concluded that the Private Warrants do not meet the criteria to be classified in stockholders’ equity (deficit).
Certain
adjustments to the settlement amount of the Private warrants are based on a variable that is not an input to the fair value of an option
as defined under ASC 815 — 40, and thus the warrants are not considered indexed to the Company’s own stock and not
eligible for an exception from derivative accounting. The accounting treatment of derivative financial instruments requires that the Company
record a derivative liability upon issuance of the warrants at the closing of the IPO. Accordingly, the Company classified each Private
Warrant as a liability at its fair value, with subsequent changes in their respective fair values recognized in the statements of operations
and comprehensive income (loss) at each reporting date.
ABRI SPAC I, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022 AND FOR THE PERIOD MARCH 18, 2021
(INCEPTION) THROUGH DECEMBER 31, 2021
NOTE 7 — WARRANTS (cont.)
The Company
accounted for the Public Warrants as equity based on its initial evaluation that the Public Warrants are indexed to the Company’s
own stock. The fair value of the Public Warrants was approximately $0.60 per Public Warrant, which was determined by the Monte Carlo
simulation model. The Public Warrants will be recorded at the amount of allocated proceeds and will not be remeasured every reporting
period.
NOTE 8 — FAIR
VALUE MEASUREMENTS
The Company
carries marketable investments, Private Warrants, at fair value. Fair value is based on the price that would be received from selling
an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value is
estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the
categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement.
The Company
determined the fair value of its Level 1 financial instruments, which are traded in active markets, using quoted market prices for identical
instruments. The Company’s marketable securities held in Trust Account is classified within Level 1 of the fair value hierarchy.
The Company’s
Private Warrants are valued as Level 2 instruments.
The estimated
fair value of the Private Warrants is determined using Level 2 inputs for the year ended December 31, 2022. The estimated fair value
of the Private Warrants was transferred from Level 3 to Level 2 during the year ended December 31, 2022. Inherent in a Black-Scholes pricing
model are assumptions related to dividend yield, term, volatility and risk-free rate. The Company estimates the volatility of its
common shares based on management’s understanding of the volatility associated with instruments of other similar entities. The risk-free interest
rate is based on the U.S. Treasury rate matching the expected term of the warrants. The expected life of the warrants is simulated
based on management assumptions regarding the timing and likelihood of completing our Initial Business Combination. The dividend rate
is based on the historical rate, which the Company anticipates remaining at zero.
The fair
value of the Private Warrants from the private placement that closed simultaneously with the closing of the IPO was $176,759, which was
determined by the Black-Scholes Pricing Model with the following assumptions: dividend yield of 0%, term of 5 years,
volatility of 13.5%, exercise price of $11.50 and risk-free rate of 0.81%. The fair value was $170,867 as of
December 31, 2021, using the following assumptions: dividend yield of 0%, term of 4.5 years, volatility of 11.8%,
exercise price of $11.50 and risk-free rate of 1.19%. The fair value was $17,676 as of December 31, 2022, using
the following assumptions: dividend yield of 0%, term of 2.75 years, volatility of 0.7%%, exercise price of $11.50 and
risk-free rate of 4.27%, resulting in a gain on change in fair value of warrant liabilities of $153,191 for the year ended
December 31, 2022.
The following
table presents information about the transfer from Level 3 to Level 2 within the fair value hierarchy during the year ended December 31,
2022:
| | |
Warrant
liabilities | | |
Total Level 3
Financial
Instruments | |
| Level 3 financial instruments as of December 31, 2021 | |
$ | 170,867 | | |
$ | 170,867 | |
| Change in fair value | |
| (153,191 | ) | |
| (153,191 | ) |
| Transfer to Level 2 | |
| (17,676 | ) | |
| (17,676 | ) |
| Level 3 financial instruments as of December 31, 2022 | |
$ | — | | |
$ | — | |
ABRI SPAC I, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022 AND FOR THE PERIOD MARCH 18, 2021
(INCEPTION) THROUGH DECEMBER 31, 2021
NOTE 8 — FAIR
VALUE MEASUREMENTS (cont.)
The following
table presents information about the Company’s assets that are measured at fair value on a recurring basis at December 31,
2022 and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:
| | |
| | |
Fair value measurements at reporting date using: | |
| Description | |
Fair Value | | |
Quoted prices
in active
markets for
identical
liabilities
(Level 1) | | |
Significant
other
observable
inputs
(Level 2) | | |
Significant
unobservable
inputs
(Level 3) | |
| Assets: | |
| | | |
| | | |
| | | |
| | |
| Marketable securities held in Trust Account | |
$ | 12,841,399 | | |
$ | 12,841,399 | | |
$ | — | | |
$ | — | |
| | |
| | | |
| | | |
| | | |
| | |
| Liabilities: | |
| | | |
| | | |
| | | |
| | |
| Warrant liabilities | |
$ | 17,676 | | |
$ | — | | |
$ | 17,676 | | |
$ | — | |
The following
table presents information about the Company’s assets that are measured at fair value on a recurring basis at December 31,
2021 and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:
| | |
| | |
Fair value measurements at reporting date using: | |
| Description | |
Fair Value | | |
Quoted prices
in active
markets for
identical
liabilities
(Level 1) | | |
Significant
other
observable
inputs
(Level 2) | | |
Significant
unobservable
inputs
(Level 3) | |
| Assets: | |
| | | |
| | | |
| | | |
| | |
| Marketable securities held in Trust Account | |
$ | 57,340,207 | | |
$ | 57,340,207 | | |
$ | — | | |
$ | — | |
| | |
| | | |
| | | |
| | | |
| | |
| Liabilities: | |
| | | |
| | | |
| | | |
| | |
| Warrant liabilities | |
$ | 170,867 | | |
$ | — | | |
$ | — | | |
$ | 170,867 | |
In some
circumstances, the inputs used to measure fair value might be categorized within different levels of the fair value hierarchy. In those
instances, the fair value measurement is categorized in its entirety in the fair value hierarchy based on the lowest level input that
is significant to the fair value measurement.
In order
to calculate the fair value of the Public Warrants at the IPO date for purposes of establishing the initial allocation of costs, the Company
utilized the following inputs to the Monte Carlo simulation model for the initial measurement:
| Underlying common stock price | |
$ | 9.48 | |
| Risk free rate | |
| 0.82 | % |
| Unit purchase price | |
$ | 10.00 | |
| Estimated term | |
| 5 Years | |
| Volatility | |
| 13.5 | % |
The Company
is not required to re-measure the fair value of the Public Warrants since they are an equity-classified instrument.
ABRI SPAC I, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022 AND FOR THE PERIOD MARCH 18, 2021
(INCEPTION) THROUGH DECEMBER 31, 2021
NOTE 9 — INCOME
TAXES
The Company
accounts for income taxes under ASC 740, which provides for an asset and liability approach of accounting for income taxes.
The income
tax provision for the year ended December 31, 2022 and for the period from March 18, 2021 (inception) to December 31, 2021
was as follows:
| | |
December 31, | |
| | |
2022 | | |
2021 | |
| Current: | |
| | |
| |
| U.S. federal | |
$ | 119,000 | | |
$ | — | |
| State and local | |
| — | | |
| — | |
| | |
| 119,000 | | |
| — | |
| Deferred: | |
| | | |
| | |
| U.S. federal | |
| (648,000 | ) | |
| (238,000 | ) |
| State and local | |
| 78,000 | | |
| (78,000 | ) |
| | |
| (570,000 | ) | |
| (316,000 | ) |
| Change in valuation allowance | |
| 570,000 | | |
| 316,000 | |
| Provision for income taxes | |
$ | 119,000 | | |
$ | — | |
A reconciliation
of the federal income tax rates to the Company’s effective tax rates for the year ended December 31, 2022 and for the period
from March 18, 2021 (inception) to December 31, 2021 consist of the following:
| | |
2022 | | |
2021 | |
| U.S. federal statutory rate | |
| 21.0 | % | |
| 21.0 | % |
| Effects of: | |
| | | |
| | |
| State taxes, net of federal benefit | |
| — | % | |
| — | % |
| Change in warrant liabilities | |
| 1.4 | % | |
| — | % |
| Tax return to provision adjustment | |
| (3.6 | )% | |
| — | % |
| Change in valuation allowance | |
| (23.8 | )% | |
| (21.0 | )% |
| Effective rate | |
| (5.0 | )% | |
| — | % |
Significant
components of the Company’s deferred tax assets as of December 31, 2022 and 2021 are summarized below.
| | |
December 31, 2022 | | |
December 31, 2021 | |
| Deferred tax assets: | |
| | | |
| | |
| Net operation loss carryforwards | |
$ | — | | |
$ | 21,000 | |
| Startup costs | |
| 886,000 | | |
| 295,000 | |
| Total deferred tax asset | |
| 886,000 | | |
| 316,000 | |
| Valuation allowance | |
| (886,000 | ) | |
| (316,000 | ) |
| | |
$ | — | | |
$ | — | |
The Company
recognizes deferred tax assets to the extent that it believes that these assets are more likely than not to be realized. In making such
a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary
differences, projected future taxable income, tax-planning strategies, and results of recent operations. The Company assessed the
need for a valuation allowance against its net deferred tax assets and determined a full valuation allowance is required the Company has
no history of generating taxable income. Therefore, a valuation allowance of $886,000 and $316,000 was recorded as of December 31,
2022 and 2021 respectively.
ABRI SPAC I, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022 AND FOR THE PERIOD MARCH 18, 2021
(INCEPTION) THROUGH DECEMBER 31, 2021
NOTE 9 — INCOME
TAXES (cont.)
The Company’s
ability to utilize net operating loss carryforwards will depend on its ability to generate adequate future taxable income. Future utilization
of the net operating loss carry forwards is subject to certain limitations under Section 382 of the Internal Revenue Code. As of
December 31, 2022 and 2021, the Company had federal net operating loss carryforwards available to offset future taxable income in
the amounts of $0 and $76,000, respectively, with no state net operating loss carryforwards available to offset future taxable income
as of December 31, 2022 and 2021. The federal net operating loss carryforwards generated do not expire.
The Company
has evaluated its income tax positions and has determined that it does not have any uncertain tax positions. The Company will recognize
interest and penalties related to any uncertain tax positions through its income tax expense.
NOTE 10 — SUBSEQUENT
EVENTS
Nasdaq Deficiency Notice
On March 23,
2023, the Company received a letter (the “MVLS Notice”) from the Listing Qualifications Department (the “Staff”)
of The Nasdaq Stock Market LLC (“Nasdaq”) notifying it that, for the last 30 consecutive business days prior to the date
of the MVLS Notice, the Minimum Value of Listed Securities (“MVLS”) was less than $35.0 million, which does not meet
the requirement for continued listing on The Nasdaq Capital Market, as required by Nasdaq Listing Rule 5550(b)(2) (the “MVLS
Rule”). In accordance with Nasdaq Listing Rule 5810(c)(3)(C), the Staff has provided the Company with 180 calendar days,
or until September 19, 2023, to regain compliance with the MVLS Rule. The MVLS Notice has no immediate effect on the listing of the
Company’s securities on The Nasdaq Capital Market.
If the
Company regains compliance with the MVLS Rule, the Staff will provide written confirmation to it and close the matter. To regain compliance
with the MVLS Rule, the Company’s MVLS must meet or exceed $35.0 million for a minimum of ten consecutive business days
during the 180-day compliance period ending on September 19, 2023. In the event the Company does not regain compliance with
the MVLS Rule prior to the expiration of the compliance period, it will receive written notification that its securities, including the
Units, Common Stock and Warrants, are subject to delisting. At that time, the Company may appeal the delisting determination to a Hearings
Panel.
Convertible Promissory
Note with Sponsor
On January 17,
2023, the Company entered a convertible promissory note with its Sponsor and received $200,000 of proceeds to be used for operating
expenses. The note was non-interest bearing, unsecured and payable on the date the Company consummates an Initial Business Combination.
In the event that an Initial Business Combination does not close prior to April 12, 2023 (or up to August 12, 2023, if the period
of time to consummate an Initial Business Combination is extended), the note shall be deemed terminated and no amounts will be owed. At
any time, up to a day prior to the closing of an Initial Business Combination, the holder may convert the principal amount into private
units of the Company at a conversion price of $10.00 per unit. As of the date that the financial statements were issued, there was
$200,000 outstanding under the note.
On February 6,
2023, Abri received proceeds of $87,500 upon entering into a non-convertible promissory note with a related party. Abri deposited
all proceeds into the Trust Account to extend the time to complete a business combination to March 12, 2023. On March 10, 2023,
Abri deposited an additional $87,500 into the Trust Account to extend the time to complete a business combination to April 12,
2023.
ABRI SPAC I, INC.
CONDENSED BALANCE SHEETS
| | |
June 30,
2023 | | |
December 31,
2022 | |
| ASSETS | |
| | | |
| | |
| Current assets: | |
| | | |
| | |
| Cash | |
$ | 148,389 | | |
$ | 381,293 | |
| Prepaid expenses and other current assets | |
| 115,967 | | |
| 252,463 | |
| Total current assets | |
| 264,356 | | |
| 633,756 | |
| Marketable securities held in Trust Account, at fair value | |
| 13,650,778 | | |
| 12,841,399 | |
| Total assets | |
$ | 13,915,134 | | |
$ | 13,475,155 | |
| | |
| | | |
| | |
| LIABILITIES, REDEEMABLE COMMON STOCK AND STOCKHOLDERS’ DEFICIT | |
| | | |
| | |
| Current liabilities: | |
| | | |
| | |
| Accounts payable and accrued expenses | |
$ | 432,649 | | |
$ | 441,739 | |
| Accrued legal fees | |
| 2,575,551 | | |
| 2,113,078 | |
| Total current liabilities | |
| 3,008,200 | | |
| 2,554,817 | |
| Promissory notes, related party | |
| 1,584,284 | | |
| 1,146,784 | |
| Convertible promissory notes, related party | |
| 1,650,000 | | |
| 1,250,000 | |
| Warrant liabilities, at fair value | |
| 10,311 | | |
| 17,676 | |
| Deferred underwriting commissions | |
| 1,500,000 | | |
| 1,500,000 | |
| Total liabilities | |
| 7,752,795 | | |
| 6,469,277 | |
| | |
| | | |
| | |
| Commitments and Contingencies (Note 4) | |
| | | |
| | |
| | |
| | | |
| | |
| Common stock subject to possible redemption, par value $0.0001, 100,000,000 shares authorized; 1,252,372 shares outstanding as of June 30, 2023 and December 31, 2022 | |
| 13,450,571 | | |
| 12,841,399 | |
| Stockholders’ deficit: | |
| | | |
| | |
| Preferred stock, par value $0.0001, 1,000,000 shares authorized, none issued and outstanding | |
| — | | |
| — | |
| Common stock, par value $0.0001, 100,000,000 shares authorized; 1,728,078 shares issued and outstanding | |
| 173 | | |
| 173 | |
| Additional paid-in capital | |
| — | | |
| — | |
| Accumulated deficit | |
| (7,288,405 | ) | |
| (5,835,694 | ) |
| Total stockholders’ deficit | |
| (7,288,232 | ) | |
| (5,835,521 | ) |
| Total liabilities, redeemable common stock and stockholders’ deficit | |
$ | 13,915,134 | | |
$ | 13,475,155 | |
The accompanying footnotes
are an integral part of these unaudited condensed financial statements.
ABRI SPAC I, INC.
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
| | |
For the
Three Months
Ended
June 30,
2023 | | |
For the
Three Months
Ended
June 30,
2022 | | |
For the
Six Months
Ended
June 30,
2023 | | |
For the
Six Months
Ended
June 30,
2022 | |
| Operating expenses: | |
| | | |
| | | |
| | | |
| | |
| Professional fees | |
$ | 341,146 | | |
$ | 307,154 | | |
$ | 761,279 | | |
$ | 1,401,354 | |
| Selling, general and administrative | |
| 186,903 | | |
| 197,451 | | |
| 344,626 | | |
| 498,960 | |
| Total operating expenses | |
| 528,049 | | |
| 504,605 | | |
| 1,105,905 | | |
| 1,900,314 | |
| | |
| | | |
| | | |
| | | |
| | |
| Loss from operations | |
| (528,049 | ) | |
| (504,605 | ) | |
| (1,105,905 | ) | |
| (1,900,314 | ) |
| | |
| | | |
| | | |
| | | |
| | |
| Other income: | |
| | | |
| | | |
| | | |
| | |
| Interest income | |
| 160,991 | | |
| 76,629 | | |
| 303,001 | | |
| 81,973 | |
| Change in fair value of warrant liabilities | |
| 16,203 | | |
| 41,244 | | |
| 7,365 | | |
| 109,002 | |
| | |
| 177,194 | | |
| 117,873 | | |
| 310,366 | | |
| 190,975 | |
| | |
| | | |
| | | |
| | | |
| | |
| Loss before income taxes | |
| (350,855 | ) | |
| (386,732 | ) | |
| (795,539 | ) | |
| (1,709,339 | ) |
| Provision for income taxes | |
| (24,000 | ) | |
| — | | |
| (48,000 | ) | |
| — | |
| Net loss | |
$ | (374,855 | ) | |
$ | (386,732 | ) | |
$ | (843,539 | ) | |
$ | (1,709,339 | ) |
| | |
| | | |
| | | |
| | | |
| | |
| Weighted-average common shares outstanding, basic and diluted, redeemable shares subject to redemption | |
| 1,252,372 | | |
| 5,733,920 | | |
| 1,252,372 | | |
| 5,733,920 | |
| Basic and diluted net income (loss) per share, redeemable shares subject to redemption | |
$ | 0.01 | | |
$ | — | | |
$ | (0.00 | ) | |
$ | (0.14 | ) |
| | |
| | | |
| | | |
| | | |
| | |
| Weighted-average common shares outstanding, basic and diluted, non-redeemable shares | |
| 1,728,078 | | |
| 1,728,078 | | |
| 1,728,078 | | |
| 1,728,078 | |
| Basic and diluted net loss per share, non-redeemable shares | |
$ | (0.23 | ) | |
$ | (0.21 | ) | |
$ | (0.49 | ) | |
$ | (0.54 | ) |
The accompanying footnotes
are an integral part of these unaudited condensed financial statements.
ABRI SPAC I, INC.
CONDENSED STATEMENTS OF CHANGE IN STOCKHOLDERS’ EQUITY (DEFICIT)
AND REDEEMABLE COMMON STOCK
(Unaudited)
| | |
Common Stock Subject to
Possible Redemption | | |
Common Stock | | |
Additional
Paid-in
Capital | | |
Accumulated
Deficit | | |
Total
Stockholder’s
Equity
(Deficit) | |
| | |
Shares | | |
Amount | | |
Shares | | |
Amount | | |
| | |
| | |
| |
| Balance, January 1, 2023 | |
| 1,252,372 | | |
$ | 12,841,399 | | |
| 1,728,078 | | |
$ | 173 | | |
$ | — | | |
$ | (5,835,694 | ) | |
$ | (5,835,521 | ) |
| Accretion of common stock to redemption value | |
| — | | |
| 307,596 | | |
| — | | |
| — | | |
| — | | |
| (307,596 | ) | |
| (307,596 | ) |
| Net loss | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| (468,684 | ) | |
| (468,684 | ) |
| Balance at March 31, 2023 | |
| 1,252,372 | | |
$ | 13,148,995 | | |
| 1,728,078 | | |
$ | 173 | | |
| — | | |
$ | (6,611,974 | ) | |
$ | (6,611,801 | ) |
| Accretion of common stock to redemption value | |
| — | | |
| 301,576 | | |
| — | | |
| — | | |
| — | | |
| (301,576 | ) | |
| (301,576 | ) |
| Net loss | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| (374,855 | ) | |
| (374,855 | ) |
| Balance at June 30, 2023 | |
| 1,252,372 | | |
$ | 13,450,571 | | |
| 1,728,078 | | |
$ | 173 | | |
| — | | |
$ | (7,288,405 | ) | |
$ | (7,288,232 | ) |
| | |
Common Stock Subject to
Possible Redemption | | |
Common Stock | | |
Additional
Paid-in
Capital | | |
Accumulated
Deficit | | |
Total
Stockholder’s
Equity
(Deficit) | |
| | |
Shares | | |
Amount | | |
Shares | | |
Amount | | |
| | |
| | |
| |
| Balance at January 1, 2022 | |
| 5,733,920 | | |
$ | 52,323,289 | | |
| 1,728,078 | | |
$ | 173 | | |
$ | 4,262,491 | | |
$ | (1,127,612 | ) | |
$ | 3,135,052 | |
| Accretion of common stock to redemption value | |
| — | | |
| 1,099,501 | | |
| — | | |
| — | | |
| (1,094,157 | ) | |
| (5,344 | ) | |
| (1,099,501 | ) |
| Net loss | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| (1,322,607 | ) | |
| (1,322,607 | ) |
| Balance at March 31, 2022 | |
| 5,733,920 | | |
$ | 53,422,790 | | |
| 1,728,078 | | |
$ | 173 | | |
$ | 3,168,334 | | |
$ | (2,455,563 | ) | |
$ | 712,944 | |
| Accretion of common stock to redemption value | |
| — | | |
| 1,195,374 | | |
| — | | |
| — | | |
| (1,118,745 | ) | |
| (76,629 | ) | |
| (1,195,374 | ) |
| Net loss | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| (386,732 | ) | |
| (386,732 | ) |
| Balance at June 30, 2022 | |
| 5,733,920 | | |
$ | 54,618,164 | | |
| 1,728,078 | | |
$ | 173 | | |
$ | 2,049,589 | | |
$ | (2,918,924 | ) | |
$ | (869,162 | ) |
The accompanying footnotes
are an integral part of these unaudited condensed financial statements.
ABRI SPAC I, INC.
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
| | |
For the Six Months
Ended
June 30,
2023 | | |
For the
Six Months
Ended
June 30,
2022 | |
| CASH FLOWS FROM OPERATING ACTIVITIES: | |
| | | |
| | |
| Net loss | |
$ | (843,539 | ) | |
$ | (1,709,339 | ) |
| Adjustments to reconcile net loss to net cash used in operating activities: | |
| | | |
| | |
| Change in fair value of warrant liabilities | |
| (7,365 | ) | |
| (109,002 | ) |
| Interest earned on marketable securities held in Trust Account | |
| — | | |
| (81,973 | ) |
| Changes in operating assets and liabilities: | |
| | | |
| | |
| Prepaid expenses and other current assets | |
| 136,496 | | |
| 72,868 | |
| Accounts payable and accrued expenses | |
| 453,383 | | |
| 1,029,259 | |
| Net cash used in operating activities | |
| (261,025 | ) | |
| (798,187 | ) |
| | |
| | | |
| | |
| CASH FLOWS FROM INVESTING ACTIVITIES: | |
| | | |
| | |
| Investments in marketable securities held in Trust Account | |
| (809,379 | ) | |
| — | |
| Net cash used in investing activities | |
| (809,379 | ) | |
| — | |
| | |
| | | |
| | |
| CASH FLOWS FROM FINANCING ACTIVITIES: | |
| | | |
| | |
| Proceeds from convertible promissory notes, related party | |
| 400,000 | | |
| — | |
| Proceeds of notes payable – related party | |
| 437,500 | | |
| 800,000 | |
| Net cash provided by financing activities | |
| 837,500 | | |
| 800,000 | |
| | |
| | | |
| | |
| NET CHANGE IN CASH | |
| (232,904 | ) | |
| 1,813 | |
| Cash – Beginning of period | |
| 381,293 | | |
| 154,942 | |
| Cash – End of period | |
$ | 148,389 | | |
$ | 156,755 | |
| | |
| | | |
| | |
| SUPPLEMENTAL CASH FLOW INFORMATION: | |
| | | |
| | |
| Non-cash investing and financing activities: | |
| | | |
| | |
| Accretion of common stock to redemption value | |
$ | 609,172 | | |
$ | 2,294,875 | |
The accompanying footnotes
are an integral part of these unaudited condensed financial statements.
ABRI SPAC I, INC.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2023
(Unaudited)
NOTE 1 — NATURE
OF THE ORGANIZATION AND BUSINESS
Abri SPAC I,
Inc (“Abri” or the “Company”) was incorporated in the State of Delaware on March 18, 2021. The Company’s
business purpose is to effect a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business
combination with one or more businesses (our “Initial Business Combination”). Throughout this report, the terms “our,”
“we,” “us,” and the “Company” refer to Abri SPAC I, Inc.
As of
June 30, 2023, and the date of this filing, the Company had not commenced core operations. All activity for the period from
March 18, 2021 (inception) through June 30, 2023 related to organizational activities, those necessary to consummate the initial
public offering (“IPO”) and identify a target company for a business combination. The Company will not generate any operating
revenues until after the completion of the Initial Business Combination, at the earliest. The Company generates non-operating income
in the form of interest income and gains from the marketable securities held in the Trust Account, and gains or losses from the change
in fair value of the warrant liabilities.
The registration
statement pursuant to which the Company registered its securities offered in the IPO was declared effective on August 9, 2021. On
August 12, 2021, the Company consummated its IPO of 5,000,000 units (each, a “Unit” and collectively, the “Units”),
at $10.00 per Unit, generating gross proceeds of $50,000,000 and incurring offering costs of $973,988. The Company granted the
underwriter a 45-day option to purchase up to an additional 750,000 Units at the IPO price to cover over-allotments.
Simultaneously
with the consummation of the closing of the Initial Public Offering, the Company completed the private sale of 276,250 units
(the “Private Units”) to Abri Ventures I, LLC (“Abri Ventures”), the Company’s sponsor (the “Sponsor”)
at a purchase price of $10.00 per Private Unit, generating gross proceeds to the Company of $2,762,500.
Following
the closing of the IPO on August 12, 2021, an amount of $50,000,000 net proceeds from the IPO and sale of the Private Units was
placed in a trust account in the United States maintained by Continental Stock Transfer & Trust Company, as trustee (the
“Trust Account”). The funds held in the Trust Account were invested only in U.S. government securities with a maturity
of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company
Act which invest only in direct U.S. government treasury obligations so that we are not deemed to be an investment company under
the Investment Company Act. Except with respect to interest earned on the funds held in the Trust Account, the Trust Account is intended
as a holding place for funds pending the earliest to occur of: (i) the completion of the Initial Business Combination; (ii) the
redemption of any public shares properly submitted in connection with a stockholder vote to amend the Company’s amended and restated
certificate of incorporation (A) to modify the substance or timing of the Company’s obligation to redeem 100% of the public
shares if the Company does not complete the initial Business Combination within 12 months from the closing of the IPO (or up to 18 months
from the closing of this offering with the mandatory extensions of the period of time to consummate an Initial Business Combination) or
(B) with respect to any other provision relating to stockholders’ rights or pre-Initial Business Combination activity;
or (iii) absent an Initial Business Combination within 12 months from the closing of the IPO (or up to 18 months from the
closing of this offering with the mandatory extensions of the period of time to consummate an Initial Business Combination), the return
of the funds held in the Trust Account to the public stockholders as part of redemption of the public shares. The Company’s amended
and restated certificate of incorporation has been further amended by stockholders to extend the time in which the Company has to complete
an Initial Business Combination to February 12, 2024.
On August 19,
2021, the underwriters notified the Company of their intent to exercise of the over-allotment option in part and, on August 23,
2021, the underwriters purchased 733,920 additional Units (the “Additional Units”) at $10.00 per Additional
Unit upon the closing of the over-allotment option, generating additional gross proceeds of $7,339,200. On August 23, 2021,
simultaneously with the sale of the Additional Units, the Company consummated the sale of an additional 18,348 Private Units at
$10.00 per additional Private Unit (the “Additional Private Units”), generating additional gross proceeds of $183,480.
A total of $7,339,200 of the net proceeds from the sale of the Additional Units and the Additional Private Units was deposited
in the Trust Account, bringing the aggregate proceeds held in the Trust Account on that date to $57,339,200.
ABRI SPAC I, INC.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2023
(Unaudited)
NOTE 1 — NATURE
OF THE ORGANIZATION AND BUSINESS (cont.)
The stock
exchange listing rules provide that the Initial Business Combination must be with one or more target businesses that together have a fair
market value equal to at least 80% of the value of the assets held in the Trust Account (as defined below) (excluding the deferred
underwriting commissions and taxes payable) at the time of the Company signing a definitive agreement in connection with the Initial Business
Combination. The Company will only complete an Initial Business Combination if the post-Initial Business Combination 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
(the “Investment Company Act”). There is no assurance that the Company will be able to successfully effect an Initial Business
Combination.
The payment
to the Company’s Sponsor of a monthly fee of $10,000 is for general and administrative services including office space, utilities
and secretarial support, which the Company records as operating expense on its statements of operations. However, pursuant to the terms
of such agreement, the Company may delay payment of such monthly fee upon a determination by the audit committee that the Company lacks
sufficient funds held outside the trust to pay actual or anticipated expenses in connection with the Initial Business Combination. Any
such unpaid amount will accrue without interest and be due and payable no later than the date of the consummation of the Initial Business
Combination. This arrangement is being agreed to by its Sponsor for the Company’s benefit. Management believes that the fee charged
by the Sponsor is at least as favorable as what could have been obtained from an unaffiliated person. This arrangement will terminate
upon completion of the Initial Business Combination or the distribution of the Trust Account to the public stockholders. Other than the
$10,000 per month fee, no compensation of any kind (including finder’s fees, consulting fees or other similar compensation)
will be paid to insiders, members of the management team or any of their respective affiliates, for services rendered prior to or in connection
with the consummation of the Initial Business Combination (regardless of the type of transaction that it is). However, such individuals
will receive reimbursement for any out-of-pocket expenses incurred by them in connection with activities on the Company’s behalf,
such as identifying potential target businesses, performing business due diligence on suitable target businesses and business combinations,
as well as traveling to and from the offices, plants or similar locations of prospective target businesses to examine their operations.
Since the role of present management after the Initial Business Combination is uncertain, the Company has no ability to determine what
remuneration, if any, will be paid to those persons after the Initial Business Combination.
The funds
outside of the Trust Account are for working capital requirements in searching for an Initial Business Combination. The allocation such
funds represents the Company’s best estimate of the intended uses of these funds. If the estimate of the costs of undertaking due
diligence and negotiating our Initial Business Combination is less than the actual amount necessary to do so, the Company may be required
to raise additional capital, the amount, availability and cost of which is currently unascertainable. In this event, the Company could
seek such additional capital through loans or additional investments from insiders, members of management team or third parties, but the
insiders, members of the Company’s management team or third parties are not under any obligation to advance funds to, or invest
in the Company.
The Company
will likely use substantially all of the net proceeds of this offering, including the funds held in the Trust Account, in connection with
the Initial Business Combination and to pay expenses relating thereto, including the deferred underwriting commissions payable to the
underwriter in an amount equal to 3.0% of the total gross proceeds raised in the offering upon consummation of the Initial Business
Combination. To the extent that the Company’s capital stock is used in whole or in part as consideration to effect the Initial Business
Combination, the proceeds held in the Trust Account which are not used to consummate an Initial Business Combination will be disbursed
to the combined company and will, along with any other net proceeds not expended, 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.
To the
extent the Company is unable to consummate an Initial Business Combination, the Company will pay the costs of liquidation from the remaining
assets outside of the Trust Account. If such funds are insufficient, the Company’s insiders have agreed to pay the funds necessary
to complete such liquidation and have agreed not to seek repayment of such expenses.
ABRI SPAC I, INC.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2023
(Unaudited)
NOTE 1 — NATURE
OF THE ORGANIZATION AND BUSINESS (cont.)
The Company
believes that it will not have sufficient available funds to operate for up to the next 12 months, assuming that the Initial Business
Combination is not consummated during that time. However, if necessary, in order to meet the Company’s working capital needs following
the consummation of this offering, the insiders may, but are not obligated to, loan the Company funds, from time to time or at any time,
in whatever amount they deem reasonable in their sole discretion. Each loan would be evidenced by a promissory note. The notes would either
be paid upon consummation of the Initial Business Combination, without interest, or, at the lender’s discretion, up to $750,000 of
the notes may be converted upon consummation of our Initial Business Combination into additional Private Warrants at a price of $1.00 per
warrant. Notwithstanding, there is no guarantee that the Company will receive such funds. The Company’s stockholders have approved
the issuance of the Private Warrants upon conversion of such notes, to the extent the holder wishes to so convert such notes at the time
of the consummation of the Initial Business Combination. If the Company does not complete an Initial Business Combination, any loans and
advances from the insiders or their affiliates, will be repaid only from amounts remaining outside the Trust Account, if any.
The Company’s
Sponsor, officers and directors have entered into a letter agreement with the Company, pursuant to which they have agreed to waive their
redemption rights with respect to their insider shares and any public shares they may hold in connection with the completion of the Initial
Business Combination. In addition, the Sponsor and its officers and directors have agreed to waive their rights to liquidating distributions
from the Trust Account with respect to their insider shares if the Company fails to complete an Initial Business Combination within the
prescribed time frame. However, if its Sponsor or any of its officers, directors or affiliates acquire public shares in or after this
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 prescribed time frame.
The Company
will provide its public stockholders with the opportunity to redeem all or a portion of their shares of common stock upon the completion
of the Initial Business Combination either (i) in connection with a stockholder meeting called to approve the Initial Business Combination
or (ii) by means of a tender offer. The decision as to whether the Company will seek stockholder approval of a proposed Initial Business
Combination or conduct a tender offer will be made by the Company, solely in the Company’s discretion. The public stockholders will
be entitled to redeem their shares at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust
Account 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 the Company to pay its franchise and income taxes, divided by the number of then
outstanding public shares, subject to the limitations. As of June 30, 2023, the amount in the Trust Account is approximately $10.90 per
public share.
The shares
of common stock subject to redemption was classified as temporary equity upon the completion of the IPO and will subsequently be accreted
to redemption value, in accordance with Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification
(“ASC”) 480, Distinguishing Liabilities from Equity, (“ASC 480”). In such case, the Company will
proceed with an Initial Business Combination if the Company has net tangible assets of at least $5,000,001 upon such consummation
of an Initial Business Combination and, if the Company seeks stockholder approval, a majority of the issued and outstanding shares voted
are voted in favor of the Initial Business Combination.
The Company
had 12 months from the closing of the IPO (the “Combination Period”) on August 9, 2021 to complete the Initial Business
Combination. On August 5, 2022, pursuant to the Company’s certificate of incorporation and investment trust agreement, the
Company deposited $573,392 into the Trust Account to extend the time to complete its Initial Business Combination for an additional
three months, or until November 12, 2022. On November 1, 2022, in connection with a second extension, Abri deposited
$573,392 (or $0.10 for each share of common stock issued in the IPO) into the Trust Account to extend the time to complete a business
combination to February 12, 2023. The Company further amended the certificate of incorporation and investment trust agreement, as
described below. If the Company is unable to complete its Initial Business Combination within the Combination Period, the Company will:
(i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business
days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in
the Trust Account, including interest earned on the funds held in the Trust Account and not
ABRI SPAC I, INC.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2023
(Unaudited)
NOTE 1 — NATURE
OF THE ORGANIZATION AND BUSINESS (cont.)
previously released to us
to pay our taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares,
which redemption will completely extinguish public stockholders’ rights as stockholders (including the right to receive further
liquidating distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval
of our remaining stockholders and the Company’s 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. There will be no
redemption rights or liquidating distributions with respect to the warrants, which will expire worthless if the Company fails to complete
its Initial Business Combination prior to the mandatory liquidation date.
Trust Account Redemptions
On December 9,
2022, the Company held a special meeting of stockholders at which such stockholders voted to amend the Company’s amended and restated
certificate of incorporation and its investment trust agreement, giving the Company the right to extend the date by which the Company
must complete its Initial Business Combination up to six times for an additional one month each time, from February 12, 2023 to August 12,
2023, by depositing $87,500 into the Trust Account for each one-month extension. In connection with the special meeting, 4,481,548 shares
of common stock were tendered for redemption, resulting in redemption payments of $45,952,278 out of the Trust Account. On February 6,
2023, March 10, 2023, April 11, 2023, May 11, 2023, June 9, 2023 and July 10, 2023, Abri deposited $87,500 into
the Trust Account for each one-month extension (or a total of $525,000) to extend the time to complete a business combination to
August 12, 2023, of which $437,500 had been deposited as of June 30, 2023. On August 7, 2023, the Company held a second
special meeting of stockholders at which such stockholders voted to amend the Company’s amended and restated certificate of incorporation
and its investment trust agreement, giving the Company the right to extend the date by which the Company must complete its Initial Business
Combination from August 12, 2023 to February 12, 2024 with no additional payment to the Company’s trust account.
Risks and Uncertainties
Management
continues to evaluate the impact of the Russia-Ukraine war on the economy and the capital markets and has concluded that, while it
is reasonably possible that such events could have negative effects on the Company’s financial position, results of its operations,
and/or search for a target company, the specific impacts are not readily determinable as of the date of these financial statements. The
financial statements do not include any adjustments that might result from the outcome of these uncertainties.
Going Concern and Management
Liquidity Plans
As of
June 30, 2023, the Company had cash of $148,389 and working capital deficiency of $2,743,844. The Company’s liquidity
needs through the date of this filing have been satisfied through proceeds from notes payable and advances from a related party and from
the issuance of common stock. The liquidity needs consist of paying existing accounts payable, identifying and evaluating prospective
business combination candidates, performing due diligence on prospective target businesses, paying for travel expenditures, selecting
the target business to merge with or acquire, and structuring, negotiating and consummating an Initial Business Combination. Although
certain of the Company’s initial stockholders, officers and directors or their affiliates have committed to loan the Company funds
from time to time or at any time, in whatever amount they deem reasonable in their sole discretion, there is no guarantee that the Company
will continue to receive such funds.
Accordingly,
the accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States
of America (“U.S. GAAP”), which contemplate continuation of the Company as a going concern and the realization of assets
and the satisfaction of liabilities in the normal course of business. These financial statements do not include any adjustments that might
result from the outcome of this uncertainty. Further, the Company has incurred and expects to continue to incur significant costs in pursuit
of financing and acquisition plans. Management plans to address this uncertainty during the period leading up to the Initial Business
ABRI SPAC I, INC.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2023
(Unaudited)
NOTE 1 — NATURE
OF THE ORGANIZATION AND BUSINESS (cont.)
Combination. The Company
cannot provide any assurance that its plans to raise capital or to consummate an Initial Business Combination will be successful. Based
on the foregoing, management believes that the Company will not have sufficient working capital and borrowing capacity to meet its needs
through the earlier of the consummation of the Initial Business Combination or one year from this filing. These factors raise substantial
doubt about the Company’s ability to continue as a going concern.
NOTE 2 — ORGANIZATION
AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying
audited financial statements have been prepared in accordance with U.S. GAAP and in accordance with the rules and regulations of
the Securities and Exchange Commission (the “SEC”). The summary of significant accounting policies presented below is designed
to assist in understanding the Company’s financial statements. Such condensed financial statements and accompanying notes are the
representations of the Company’s management, who is responsible for their integrity and objectivity.
Unaudited Interim Financial
Statements
In the
opinion of the Company, the unaudited financial statements contain all adjustments, consisting of only normal recurring adjustments, necessary
for a fair statement of its financial position as of June 30, 2023, and its results of operations for the three and six months
ended June 30, 2023.
The accompanying
unaudited condensed financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for
the year ended December 31, 2022 as filed with the SEC on March 31, 2023, which contains the audited financial statements and
notes thereto. The financial information as of December 31, 2022 is derived from the audited financial statements presented in the
Company’s Annual Report on Form 10-K for the year ended December 31, 2022. The interim results for the three and
six months ended June 30, 2023 are not necessarily indicative of the results to be expected for the year ending December 31,
2023 or for any future interim periods.
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 auditor 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 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 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 which is neither an emerging growth company nor an emerging growth company which has opted out of using the
extended transition period difficult or impossible because of the potential differences in accounting standards used.
ABRI SPAC I, INC.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2023
(Unaudited)
NOTE 2 — ORGANIZATION
AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
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 at the date of the financial
statements and the reported amounts of revenues and expenses during the reporting period. Making estimates requires management to exercise
significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances
that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near
term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates.
Cash Equivalents
The Company
considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents.
The Company did not have any cash equivalents as of June 30, 2023 or December 31, 2022.
Marketable Securities
Held in Trust Account
The Company
has marketable securities held in the Trust Account consisting of securities held in a money market fund that invests in U. S. governmental
securities with a maturity of 180 days or less which meet certain conditions under Rule 2a-7 under the Investment
Company Act. Marketable securities held in the Trust Account are classified as trading securities. Trading securities are presented on
the balance sheets at fair value at the end of each reporting period. Gains and losses resulting from the change in fair value of these
securities and interest income are included in the condensed statements of operations. The estimated fair values of the investments held
in the Trust Account are determined using available market information.
Warrant Liabilities
The Company
accounts for the Private Warrants in accordance with the guidance contained in ASC 480 under which the Private Warrants do not meet
the criteria for equity treatment and must be recorded as derivative liabilities. Accordingly, upon issuance, the Company classified the
Private Warrants as liabilities at their fair value and will adjust the Private Warrants to fair value at each reporting period. This
liability is subject to re-measurement at each balance sheet date until the Private Warrants are exercised or expire, and any change
in fair value is recognized in the Company’s statements of operations. The fair value of the Private Warrants will be initially
and subsequently measured at the end of each reporting period using a Black-Scholes option pricing model.
The Company
accounts for the Public Warrants in accordance with the guidance contained in ASC 815-40 under which the Public Warrants meet
the criteria for equity treatment and are recorded as equity.
Common Stock Subject to
Possible Redemption
The Company
accounts for its common stock subject to possible redemption in accordance with the guidance in ASC 480. Common stock subject to
mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock (including
common stock that feature redemption rights that is either within the control of the holder or subject to redemption upon the occurrence
of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times, common stock
is classified as stockholders’ equity. The Company’s common stock features certain redemption rights that are considered to
be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, common stock subject to possible
redemption will be presented at redemption value and as temporary equity, outside of the stockholders’ equity (deficit) section
of the Company’s balance sheets.
ABRI SPAC I, INC.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2023
(Unaudited)
NOTE 2 — ORGANIZATION
AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
The Company
has made a policy election in accordance with ASC 480 and will accrete changes in redemption value in additional paid-in capital
(or accumulated deficit in the absence of additional paid-in capital) through the time period to complete the Initial Business Combination.
In connection with a redemption of shares, any unrecognized accretion will be fully recognized for shares that are redeemed. As of June 30,
2023, the Company had recorded accretion of $609,172, with unrecognized accretion of $200,206 remaining.
Income Taxes
The Company
follows the asset and liability method of accounting for income taxes under ASC 740, Income Taxes. Deferred tax assets
and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying
amounts of existing assets and liabilities 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.
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. The Company recognizes accrued interest and penalties related to unrecognized tax benefits
as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of June 30, 2023
and December 31, 2022. The Company is currently not aware of any 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 taxing authorities since inception.
Concentration of Credit
Risk
Financial
instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution,
which, at times, may exceed the Federal Depository Insurance Coverage. As of June 30, 2023 and December 31, 2022, the Company
had not experienced losses on this account and management believes the Company is not exposed to significant risks on such account.
Fair Value of Financial
Instruments
The fair
value of the Company’s assets and liabilities, which qualify as financial instruments under ASC 820, Fair Value Measurement,
approximates the carrying amounts represented in the accompanying balance sheet, primarily due to their short-term nature.
Fair Value Measurements
Fair value
is defined as the price that would be received for sale of an asset or paid for transfer of a liability, in an orderly transaction between
market participants at the measurement date. U.S. GAAP establishes a three-tier fair value hierarchy, which prioritizes the
inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical
assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers include:
| |
· |
Level 1, defined as observable inputs such as quoted prices (unadjusted) for identical instruments in active markets; |
| |
· |
Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and |
ABRI SPAC I, INC.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2023
(Unaudited)
NOTE 2 — ORGANIZATION
AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
| |
· |
Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. |
In some
circumstances, the inputs used to measure fair value might be categorized within different levels of the fair value hierarchy. In those
instances, the fair value measurement is categorized in its entirety in the fair value hierarchy based on the lowest level input that
is significant to the fair value measurement.
Derivative Financial Instruments
The Company
evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives
in accordance with ASC 815, Derivatives and Hedging. For derivative financial instruments that are accounted for as liabilities,
the derivative instrument is initially recorded at its fair value on the issuance date and is then re-valued at each reporting date,
with changes in the fair value reported in the statements of operations. The classification of derivative instruments, including whether
such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative liabilities
are classified in the balance sheet as current or non-current based on whether or not net-cash settlement or conversion of the
instrument could be required within 12 months of the balance sheet date.
Net Income (Loss) Per
Share
Net loss
per share is computed by dividing net loss by the weighted average number of common shares outstanding during the reporting period. Diluted
net income (loss) per share is computed similar to basic income (loss) per share, except the weighted average number of common shares
outstanding are increased to include additional shares from the assumed exercise of share options, if dilutive. All outstanding convertible
notes are considered common stock at the beginning of the period or at the time of issuance, if later, pursuant to the if-converted method.
Since the effect of common stock equivalents is anti-dilutive with respect to losses, the shares issuable upon conversion have been
excluded from the Company’s computation of net loss per common share for the three and six months ended June 30, 2023
and 2022.
The following
table summarizes the securities that would be excluded from the diluted per share calculation because the effect of including these potential
shares was antidilutive due to the Company’s net loss position, even though the exercise price could be less than the most recent
fair value of the common shares:
| | |
As of
June 30,
2023 | |
| Potential shares from convertible debt | |
| 165,000 | |
| Total | |
| 165,000 | |
| | |
As of
June 30,
2022 | |
| Potential shares from convertible debt | |
| 80,000 | |
| Total | |
| 80,000 | |
The statements
of operations include a presentation of loss per redeemable share and loss per non-redeemable share following the two-class method
of loss per share. In order to determine the net loss attributable to both the redeemable shares and non-redeemable shares, the Company
first considered the total loss allocable to both sets of shares. This is calculated using the total net loss less any dividends paid.
For purposes of calculating net loss per share, any remeasurement of the ordinary shares subject to possible redemption was considered
to be dividends paid to holders of redeemable common stock. For the three and six months ended June 30, 2023 and 2022, this
had an antidilutive effect on earnings per share for the non-redeemable shares. Therefore, the Company did not allocate any portion
of the loss to the redeemable shares subject to redemption.
ABRI SPAC I, INC.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2023
(Unaudited)
NOTE 2 — ORGANIZATION
AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
For the
three and six months ended June 30, 2023 and 2022, the net loss per share included within the statements of operations is based
on the following:
For the Three Months
Ended June 30, 2023
| Net loss | |
$ | (374,855 | ) |
| Accretion of temporary equity to redemption value | |
| (301,576 | ) |
| Net loss including accretion of temporary equity to redemption value | |
$ | (676,431 | ) |
| | |
Common
Shares
Subject to
Redemption | | |
Non-redeemable
Common
Shares | |
| Basic and diluted net loss per share: | |
| | | |
| | |
| Numerator: | |
| | | |
| | |
| Allocation of net loss including accretion of temporary equity | |
$ | (284,233 | ) | |
$ | (392,198 | ) |
| Accretion of temporary equity to redemption value | |
| 301,576 | | |
| — | |
| Allocation of net income (loss) | |
$ | 17,343 | | |
$ | (392,198 | ) |
| | |
| | | |
| | |
| Denominator: | |
| | | |
| | |
| Weighted-average shares outstanding | |
| 1,252,372 | | |
| 1,728,078 | |
| Basic and diluted net income (loss) per share | |
$ | 0.01 | | |
$ | (0.23 | ) |
For the Three Months
Ended June 30, 2022
| Net loss |
|
$ |
(386,732 |
) |
| Accretion of temporary equity to redemption value |
|
|
(1,195,374 |
) |
| Net loss including accretion of temporary equity to redemption value |
|
$ |
(1,582,106 |
) |
| | |
Common
Shares
Subject to
Redemption | | |
Non-redeemable
Common
Shares | |
| Basic and diluted net loss per share: | |
| | | |
| | |
| Numerator: | |
| | | |
| | |
| Allocation of net loss including accretion of temporary equity | |
$ | (1,215,716 | ) | |
$ | (366,390 | ) |
| Accretion of temporary equity to redemption value | |
| 1,195,371 | | |
| — | |
| Allocation of net loss | |
$ | (20,342 | ) | |
$ | (366,390 | ) |
| | |
| | | |
| | |
| Denominator: | |
| | | |
| | |
| Weighted-average shares outstanding | |
| 5,733,920 | | |
| 1,728,078 | |
| Basic and diluted net loss per share | |
$ | (0.00 | ) | |
$ | (0.21 | ) |
For the Six Months
Ended June 30, 2023
| Net loss |
|
$ |
(843,539 |
) |
| Accretion of temporary equity to redemption value |
|
|
(609,172 |
) |
| Net loss including accretion of temporary equity to redemption value |
|
$ |
(1,452,711 |
) |
ABRI SPAC I, INC.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2023
(Unaudited)
NOTE 2 — ORGANIZATION
AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
| | |
Common
Shares
Subject to
Redemption | | |
Non-redeemable
Common
Shares | |
| Basic and diluted net loss per share: | |
| | | |
| | |
| Numerator: | |
| | | |
| | |
| Allocation of net loss including accretion of temporary equity | |
$ | (610,423 | ) | |
$ | (842,288 | ) |
| Accretion of temporary equity to redemption value | |
| 609,172 | | |
| — | |
| Allocation of net loss | |
$ | (1,251 | ) | |
$ | (842,288 | ) |
| | |
| | | |
| | |
| Denominator: | |
| | | |
| | |
| Weighted-average shares outstanding | |
| 1,252,372 | | |
| 1,728,078 | |
| Basic and diluted net loss per share | |
$ | (0.00 | ) | |
$ | (0.49 | ) |
| | |
| | | |
| | |
| For the Six Months Ended June 30, 2022 | |
| | | |
| | |
| Net loss | |
| | | |
$ | (1,709,339 | ) |
| Accretion of temporary equity to redemption value | |
| | | |
| (2,294,875 | ) |
| Net loss including accretion of temporary equity to redemption value | |
| | | |
$ | (4,004,214 | ) |
| | |
Common
Shares
Subject to
Redemption | | |
Non-redeemable
Common
Shares | |
| Basic and diluted net income (loss) per share: | |
| | | |
| | |
| Numerator: | |
| | | |
| | |
| Allocation of net loss including accretion of temporary equity | |
$ | (3,076,903 | ) | |
$ | (927,311 | ) |
| Accretion of temporary equity to redemption value | |
| 2,294,875 | | |
| — | |
| Allocation of net loss | |
$ | (782,028 | ) | |
$ | (927,311 | ) |
| | |
| | | |
| | |
| Denominator: | |
| | | |
| | |
| Weighted-average shares outstanding | |
| 5,733,920 | | |
| 1,728,078 | |
| Basic and diluted net loss per share | |
$ | (0.14 | ) | |
$ | (0.54 | ) |
As of
June 30, 2023 and 2022, any securities and other contracts that could, potentially, be exercised or converted into common stock would
be antidilutive due to the Company’s loss position. As a result, diluted loss per share is the same as basic loss per share for
the periods presented.
Recent Accounting Pronouncements
Management
does not believe that any recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material
effect on the Company’s unaudited financial statements.
NOTE 3 — RELATED
PARTY TRANSACTIONS
Promissory Notes — Related
Party
On August 5
and November 1 of 2022, the Company entered into a promissory note with its Sponsor of principal amounts received of $573,392 for
each note to extend the time available for the Company to consummate its Initial Business Combination. The notes are non-interest bearing,
unsecured and payable on the date the Company consummates an Initial Business Combination.
ABRI SPAC I, INC.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2023
(Unaudited)
NOTE 3 — RELATED
PARTY TRANSACTIONS (cont.)
On February 10,
March 10, April 10, May 12, and June 9 of 2023, the Company entered into five promissory notes with its
Sponsor of principal amounts received of $87,500 for each note to extend the time available for the company to consummate its initial
business combination. The notes are non-interest bearing, unsecured and payable on the date the Company consummates an Initial Business
Combination.
In the
event that an Initial Business Combination does not close prior to February 12, 2024 (or later if the period of time to consummate
an Initial Business Combination is extended), the notes shall be deemed terminated and no amounts will be owed. As of June 30 2023,
there was $1,584,284 outstanding in the aggregate under the notes.
Convertible Promissory
Notes — Related Party
During
2022, the Company entered into four convertible promissory notes with its Sponsor for aggregate principal amounts received of $1,250,000 (the
“2022 Convertible Promissory Notes”). The first convertible promissory note of $300,000 was used for a portion of the
expenses of the IPO. The remaining borrowings were used for operating expenses. All of the notes are non-interest bearing, unsecured
and payable on the date the Company consummates a Business Combination. In the event that a Business Combination does not close prior
to February 12, 2024, the notes shall be deemed terminated and no amounts will be owed. At any time, up to a day prior to the
closing of an Initial Business Combination, the holder may convert the principal amounts into private units of the Company at a conversion
price of $10.00 per unit. As of June 30, 2023 and December 31, 2022, there was $1,250,000 outstanding under the 2022
Convertible Promissory Notes.
During
2023, the Company entered into three convertible promissory notes with its Sponsor of aggregate principal amounts of $400,000 to
be used for operating expenses (the “2023” Convertible Promissory Notes”). The 2023 Convertible Promissory Notes carry
the same terms as the 2022 Convertible Promissory Notes. As of June 30, 2023 and December 31, 2022, there was $400,000 and
$0, respectively, outstanding under the 2023 Convertible Promissory Notes.
Administrative and Support
Services
The Company
entered into an administrative services agreement pursuant to which the Company will pay the Sponsor a total of $10,000 per month
for office space, administrative and support services, which the Company records as operating expense on its statements of operations.
Upon the completion of the Initial Business Combination or our liquidation, the Company will cease paying these monthly fees. The Company
recorded $30,000 and $60,000 related to these fees during the three and six months ended June 30, 2023 and 2022. As
of June 30, 2023 and December 31, 2022, the Company owed the Sponsor $70,000 and $10,000, respectively, under this agreement,
which is included in accounts payable and accrued expenses in the accompanying balance sheets.
NOTE 4 — COMMITMENTS
AND CONTINGENCIES
Merger Agreement with
DLQ
On September 9,
2022, the Company, entered into a Merger Agreement (the “Merger Agreement”) by and among Abri Merger Sub, Inc., a Delaware
corporation and a wholly owned subsidiary of Abri (“Merger Sub”), Logiq, Inc., a Delaware corporation (“DLQ Parent”)
whose common stock is quoted on the OTCQX Market under the ticker symbol, “LGIQ”, and DLQ, Inc., a Nevada corporation (“DLQ”)
and wholly owned subsidiary of DLQ Parent. Pursuant to the terms of the Merger Agreement, a business combination between the Company and
DLQ will be effected through the merger of Merger Sub with and into DLQ, with DLQ surviving the merger as a wholly owned subsidiary of
the Company (the “Merger”). The board of directors of the Company has (i) approved and declared advisable the Merger
Agreement, the Additional Agreements (as defined in the Merger Agreement) and the transactions contemplated thereby and (ii) resolved
to recommend approval of the Merger Agreement and related transactions by the stockholders of the Company.
ABRI SPAC I, INC.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2023
(Unaudited)
NOTE 4 — COMMITMENTS
AND CONTINGENCIES (cont.)
The Merger
is expected to be consummated after obtaining the required approval by the stockholders of the Company, DLQ and DLQ Parent and the satisfaction
of certain other customary closing conditions.
The total
consideration to be paid at Closing (the “Merger Consideration”) by the Company to DLQ security holders will be an amount
equal to $114,000,000. The Merger Consideration will be payable in shares of common stock, par value $0.0001 per share, of the Company
(“Abri Common Stock”).
DLQ Management Earnout
Agreement
In connection
with the execution of the Merger Agreement, Abri and the Sponsor will enter into a management earnout agreement (the “Management
Earnout Agreement”), pursuant to which certain members of the management team of DLQ specified on schedule A to the Management Earnout
Agreement (the “Management”) will have the contingent right to earn the Management Earnout Shares (as defined in the Management
Earnout Agreement). The Management Earnout Shares consist of 2,000,000 shares of Abri Common Stock (the “Management Earnout
Shares”). The release of the Management Earnout Shares shall occur as follows:
| • | 500,000 Management Earnout Shares will be earned and released
upon satisfaction of the First Milestone Event (as defined in the Management Earnout Agreement); |
| • | 650,000 Management Earnout Shares will be earned and released
upon satisfaction of the Second Milestone Event (as defined in the Management Earnout Agreement); and |
| • | 850,000 Management Earnout Shares will be earned and released
upon satisfaction of the Third Milestone Event (as defined in the Management Earnout Agreement). |
If the
Company has not consummated an initial business combination by February 12, 2024, the Company will be required to dissolve and liquidate.
Registration Rights
The holders
of the Founder Shares are entitled to registration rights pursuant to a registration rights agreement that was signed as of the effective
date of the IPO. The holders of the majority of these securities are entitled to make up to three demands that the Company register
such securities. The holders of the majority of the Founder Shares can elect to exercise these registration rights at any time commencing
three months prior to the date on which the Founder Shares 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 our Initial
Business Combination. The holders of the Founder Shares have agreed not to transfer, assign or sell any of the such shares (except to
certain permitted transferees) until, with respect to 50% of such shares, the earlier of six months after the date of the consummation
of our Initial Business Combination and the date on which the closing price of our common stock equals or exceeds $12.50 per share
for any 20 trading days within a 30-trading day period following the consummation of our Initial Business Combination and, with
respect to the remaining 50% of such shares, six months after the date of the consummation of our Initial Business Combination,
or earlier in each case if, subsequent to our Initial Business Combination, we complete a liquidation, merger, stock exchange or other
similar transaction which results in all of our stockholders having the right to exchange their shares of common stock for cash, securities
or other property. The Founder Shares will be held in escrow with Continental Stock Transfer & Trust Company during the period
in which they are subject to the transfer restrictions described above.
Unit Purchase Option
We sold
to the underwriters, for $100, an option to purchase up to a total of 300,000 units (increased to 344,035 units after
the over-allotment was exercised in part) exercisable, in whole or in part, at $11.50 per unit, commencing on the consummation
of our Initial Business Combination. The purchase option may be exercised
ABRI SPAC I, INC.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2023
(Unaudited)
NOTE 4 — COMMITMENTS
AND CONTINGENCIES (cont.)
for cash or on a cashless
basis, at the holder’s option, and expires five years from the commencement of sales in this offering. The option
and the 300,000 units, as well as the 300,000 shares of common stock, and the warrants to purchase 300,000 shares
of common stock that may be issued upon exercise of the option, have been deemed compensation by FINRA and are therefore subject to a
lock-up for a period of 180 days immediately following the effective date of the registration statement or the commencement
of sales in the IPO pursuant to Rule 5110(e)(1) of FINRA’s Rules, during which time the option may not be sold, transferred,
assigned, pledged or hypothecated, or be subject of any hedging, short sale, derivative or put or call transaction that would result in
the economic disposition of the securities. Additionally, the option may not be sold, transferred, assigned, pledged or hypothecated for
a one-year period (including the foregoing 180-day period) following the date of the Company’s initial prospectus except
to any underwriter and selected dealer participating in the offering and their bona fide officers or partners. The option grants to holders
demand and “piggy-back” rights of the securities directly and indirectly issuable upon exercise of the option. Notwithstanding
the foregoing, the underwriters and their related persons may not (i) have more than one demand registration right at our expense,
(ii) exercise their demand registration rights more than five (5) years from the effective date of the registration statement,
and (iii) exercise their “piggy-back” registration rights more than seven (7) years from the effective date of the
registration statement. We will bear all fees and expenses attendant to registering the securities, other than underwriting commissions
which will be paid for by the holders themselves. The exercise price and number of units issuable upon exercise of the option may be adjusted
in certain circumstances including in the event of a stock dividend, or our recapitalization, reorganization, merger or consolidation.
However, the option will not be adjusted for issuances of shares of common stock at a price below its exercise price. We will have no
obligation to net cash settle the exercise of the purchase option or the warrants underlying the purchase option. The holder of the purchase
option will not be entitled to exercise the purchase option or the warrants underlying the purchase option unless a registration statement
covering the securities underlying the purchase option is effective or an exemption from registration is available. If the holder is unable
to exercise the purchase option or underlying warrants, the purchase option or warrants, as applicable, will expire worthless.
On August 12,
2021, the Company accounted for the unit purchase option, inclusive of the receipt of $100 cash payment, as an expense of the Initial
Public Offering resulting in a charge directly to stockholders’ equity.
NOTE 5 — STOCKHOLDERS’
DEFICIT
Common Stock
The Company
has authorized 100,000,000 shares of common stock, par value $0.0001 per share, and 1,000,000 shares of preferred
stock, par value $0.0001 per share.
Public and Private Warrants
Each whole
warrant entitles the registered holder to purchase one common stock at a price of $11.50 per share, subject to adjustment as discussed
below, at any time commencing on the later of the completion of an Initial Business Combination and one year from the consummation
of the Company’s IPO. The warrants will expire five years after the completion of our Initial Business Combination,
or earlier upon redemption.
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. It is our current intention to 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 in effect promptly following consummation of an Initial Business Combination. Notwithstanding the foregoing, if
a registration statement covering the shares of common stock issuable upon exercise of the public warrants is not effective within 90 days
following the consummation of our Initial Business Combination, public 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.
ABRI SPAC I, INC.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2023
(Unaudited)
NOTE 5 — STOCKHOLDERS’
DEFICIT (cont.)
We may
redeem the outstanding warrants, in whole and not in part, at a price of $0.01 per warrant:
| • | at any time while the warrants are exercisable; |
| • | upon a minimum of 30 days’ prior written notice of
redemption; |
| • | if, and only if, the last sales price of our shares of common
stock equals or exceeds $16.50 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. |
If the
foregoing conditions are satisfied and we issue a notice of redemption, each warrant holder can exercise his, her or its warrant prior
to the scheduled redemption date. However, the price of the shares of common stock may fall below the $16.50 trigger price as well
as the $11.50 warrant exercise price per share after the redemption notice is issued and not limit our ability to complete the redemption.
The redemption
criteria for our warrants have been established at a price which 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 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.
Common Stock Subject to
Redemption
The Company’s
common stock feature certain redemption rights that are considered to be outside of the Company’s control and subject to the occurrence
of future events. The Company is authorized to issue 100,000,000 shares of common stock with a par value of $0.0001 per
share. Holders of the Company’s common stock are entitled to one vote for each share. As of June 30, 2023 and December 31,
2022, there were 1,252,372 shares of common stock outstanding subject to possible redemption and are classified outside of permanent
equity in the balance sheets.
ABRI SPAC I, INC.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2023
(Unaudited)
NOTE 5 — STOCKHOLDERS’
DEFICIT (cont.)
The balances
of common stock subject to possible redemption reflected on the balance sheets are reconciled in the following table:
| Common stock subject to possible redemption as of December 31, 2021 | |
$ | 52,323,289 | |
| Plus: | |
| | |
| Accretion of common stock subject to possible redemption | |
| 6,470,389 | |
| Less: | |
| | |
| Common stock redeemed on December 19, 2022 | |
| (45,952,279 | ) |
| Common stock subject to possible redemption as of December 31, 2022 | |
| 12,841,399 | |
| Plus: | |
| | |
| Accretion of common stock subject to possible redemption | |
| 609,172 | |
| Common stock subject to possible redemption as of June 30, 2023 | |
$ | 13,450,571 | |
NOTE 6 — WARRANTS
On August 12,
2021, the Company consummated its IPO of 5,000,000 Units at $10.00 per Unit, generating gross proceeds of $50,000,000,
with each Unit consisting of one share of common stock, $0.0001 par value, and one redeemable warrant. The Company granted the underwriter
a 45-day option to purchase up to an additional 750,000 Units at the IPO price to cover over-allotments.
Simultaneously
with the consummation of the closing of the IPO, the Company completed the private sale of 276,250 Private Units to its
Sponsor at a purchase price of $10.00 per Private Unit, generating gross proceeds to the Company of $2,762,500, with each Private
Unit consisting of one share of common stock, $0.0001 par value, and one redeemable warrant.
Upon consummation
of our IPO, we sold to the underwriters, for $100, an option to purchase up to a total of 300,000 units (increased to 344,035 units
after the over-allotment was exercised in part) exercisable, in whole or in part, at $11.50 per unit, commencing on the consummation
of our Initial Business Combination. The purchase option may be exercised for cash or on a cashless basis, at the holder’s option,
and expires five years from the commencement of sales in this offering. The option and the 300,000 units, as
well as the 300,000 shares of common stock, and the warrants to purchase 300,000 shares of common stock that may be
issued upon exercise of the option have been deemed compensation by FINRA and are therefore subject to a lock-up for a period of
180 days immediately following the effective date of our registration statement, or August 9, 2021. As of August 12, 2021,
the Company accounted for the unit purchase option, inclusive of the receipt of $100 cash payment, as an expense of the IPO resulting
in a charge directly to stockholders’ equity.
On August 19,
2021, the underwriters notified the Company of their intent to exercise of the over-allotment option in part and, on August 23,
2021, the underwriters purchased 733,920 Additional Units at $10.00 per Additional Unit upon the closing of the over-allotment option,
generating additional gross proceeds of $7,339,200. On August 23, 2021, simultaneously with the sale of the Additional Units, the
Company consummated the sale of an additional 18,348 Additional Private Units, generating additional gross proceeds of $183,480,
with each Additional Private Unit consisting of one share of common stock, $0.0001 par value, and one redeemable warrant.
On April 13,
2022, the Company and Continental Stock Transfer & Trust Company (the “Warrant Agent”), entered into a supplement
(the “Supplement to Warrant Agreement”) to the Warrant Agreement, dated as of August 9, 2021 by and between the Company
and the Warrant Agent in connection with the Company’s IPO. The Supplement to Warrant Agreement is being made pursuant to Section 9.8
of the Warrant Agreement which states the Warrant Agreement may be amended by the parties thereto by executing a supplemental warrant
agreement without the consent of any of the warrant holders. The Supplement to Warrant Agreement is being executed solely to correct an
ambiguity provision contained in Section 2.5 of the Warrant Agreement to clarify that the lock-up period for the Private Warrants
extends to 30 days after the completion of the Company’s Initial Business Combination.
ABRI SPAC I, INC.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2023
(Unaudited)
NOTE 6 — WARRANTS (cont.)
Each Private
Unit, Additional Unit and Additional Private Unit are identical to the Unit from our IPO except as described below.
The Sponsor
has agreed to waive its redemption rights with respect to any shares underlying the Private Units (i) in connection with the
consummation of a business combination, (ii) in connection with a stockholder vote to amend our amended and restated certificate
of incorporation 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, to redeem 100% of our public shares if we do not complete our Initial Business Combination
within 12 months from the completion of this offering (or up to 18 months from the closing of this offering if extended) or
with respect to any other provision relating to stockholders’ rights or pre-Initial Business Combination activity and (iii) if
we fail to consummate a business combination within 12 months from the completion of this offering (or up to 18 months from
the closing of this offering if extended) or if we liquidate prior to the expiration of the 18 month period. However, the Sponsor
will be entitled to redemption rights with respect to any public shares it holds if we fail to consummate a business combination or liquidate
within the 18-month period.
The Private
Units and their component securities will not be transferable, assignable or saleable until 30 days after the consummation of
our Initial Business Combination except to permitted transferees.
The Company
evaluated the Public and Private Warrants as either equity-classified or liability-classified instruments based on an assessment
of the warrants’ specific terms and ASC 480 and ASC 815. The assessment considers whether the warrants are freestanding
financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants
meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s
own common stock, among other conditions for equity classification. Pursuant to such evaluation, the Company further evaluated the Public
and Private Warrants under ASC 815-40, Derivatives and Hedging — Contracts in Entity’s Own Equity and
concluded that the Private Warrants do not meet the criteria to be classified in stockholders’ equity (deficit).
Certain
adjustments to the settlement amount of the Private warrants are based on a variable that is not an input to the fair value of an option
as defined under ASC 815 — 40, and thus the warrants are not considered indexed to the Company’s own stock and not
eligible for an exception from derivative accounting. The accounting treatment of derivative financial instruments requires that the Company
record a derivative liability upon issuance of the warrants at the closing of the IPO. Accordingly, the Company classified each Private
Warrant as a liability at its fair value, with subsequent changes in their respective fair values recognized in the statements of operations
and comprehensive income (loss) at each reporting date.
The Company
accounted for the Public Warrants as equity based on its initial evaluation that the Public Warrants are indexed to the Company’s
own stock. The fair value of the Public Warrants was approximately $0.60 per Public Warrant, which was determined by the Monte Carlo
simulation model. The Public Warrants will be recorded at the amount of allocated proceeds and will not be remeasured every reporting
period.
NOTE 7 — FAIR
VALUE MEASUREMENTS
The Company
carries cash equivalents, marketable investments, Private Warrants, at fair value. Fair value is based on the price that would be received
from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair
value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and
bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement.
The Company
determined the fair value of its Level 1 financial instruments, which are traded in active markets, using quoted market prices for identical
instruments. The Company’s Marketable Securities held in Trust Account is classified within Level 1 of the fair value hierarchy.
ABRI SPAC I, INC.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2023
(Unaudited)
NOTE 7 — FAIR
VALUE MEASUREMENTS (cont.)
The Company’s
Private Warrants are valued as Level 2 instruments.
The estimated
fair value of the Private Warrants is determined using Level 2 inputs for the period ended June 30, 2023. Inherent in a Black-Scholes pricing
model are assumptions related to dividend yield, term, volatility and risk-free rate, which results in the call option value. The
Company estimates the volatility of its common shares based on management’s understanding of the volatility associated with instruments
of other similar entities. The risk-free interest rate is based on the U.S. Treasury rate matching the expected term of the
warrants. The expected life of the warrants is simulated based on management assumptions regarding the timing and likelihood of completing
our Initial Business Combination. The dividend rate is based on the historical rate, which the Company anticipates remaining at zero.
The fair
value and call option value of the Private Warrants as of June 30, 2023 was $10,311, which was determined by the Black-Scholes Pricing
Model with the following assumptions: dividend yield of 0%, term of 1.25 years, volatility of 1.4%, exercise price
of $11.50 and risk-free rate of 5.27%, resulting in a gain on the change in fair value of warrant liability of $16,203 and
$7,365 for the three and six months ended June 30, 2023, respectively. The fair value and call option value of the
Private Warrants as of June 30, 2022 was $61,865, which was determined by the Black-Scholes Pricing Model with the following
assumptions: dividend yield of 0%, term of 4.75 years, volatility of 2.5%, exercise price of $11.50 and risk-free rate
of 3.01%, resulting in a gain on change in fair value of warrant liability of $41,244 and $109,002 for the three and six months
ended June 30, 2022, respectively.
The following
table presents the change in fair value from December 31, 2022 to June 30, 2023:
| | |
Warrant
liabilities | |
| Level 2 financial instruments as of December 31, 2022 | |
$ | 17,676 | |
| Change in fair value | |
| 8,838 | |
| Level 2 financial instruments as of March 31, 2023 | |
| 26,514 | |
| Change in fair value | |
| (16,203 | ) |
| Level 2 financial instruments as of June 30, 2023 | |
$ | 10,311 | |
Transfers
to/from Levels 1, 2, and 3 are recognized at the beginning of the reporting period. There were no transfers during the three
and six months ended June 30, 2023. The Company transferred the Private Warrants from Level 3 to Level 2 during the three months
ended June 30, 2022, as the inputs significant to the valuation became observable as they are benchmarked to those used for the Public
Warrants.
The following
table presents the transfers and the change in fair value from December 31, 2021 to June 30, 2022:
| | |
Warrant
liabilities | |
| Level 3 financial instruments as of December 31, 2021 | |
$ | 170,867 | |
| Change in fair value | |
| (67,758 | ) |
| Level 3 financial instruments as of March 31, 2022 | |
| 103,109 | |
| Change in fair value | |
| (41,244 | ) |
| Transfer to Level 2 | |
| (67,865 | ) |
| Level 3 financial instruments as of June 30, 2022 | |
$ | — | |
ABRI SPAC I, INC.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2023
(Unaudited)
NOTE 7 — FAIR
VALUE MEASUREMENTS (cont.)
The following
table presents information about the Company’s assets that are measured at fair value on a recurring basis at June 30, 2023
and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:
| | |
| | |
Fair value measurements at reporting date using: | |
| Description | |
Fair Value | | |
Quoted
prices in
active markets
for identical
liabilities
(Level 1) | | |
Significant
other
observable inputs
(Level 2) | | |
Significant
unobservable
inputs
(Level 3) | |
| Assets: | |
| | | |
| | | |
| | | |
| | |
| Marketable securities held in Trust Account | |
$ | 13,650,778 | | |
$ | 13,650,778 | | |
$ | — | | |
$ | — | |
| | |
| | | |
| | | |
| | | |
| | |
| Liabilities: | |
| | | |
| | | |
| | | |
| | |
| Warrant liabilities | |
$ | 10,311 | | |
$ | — | | |
$ | 10,311 | | |
$ | — | |
The following
table presents information about the Company’s assets that are measured at fair value on a recurring basis at December 31,
2022 and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:
| | |
| | |
Fair value measurements at reporting date using: | |
| Description | |
Fair Value | | |
Quoted
prices in
active markets
for identical
liabilities
(Level 1) | | |
Significant
other
observable
inputs
(Level 2) | | |
Significant
unobservable
inputs
(Level 3) | |
| Assets: | |
| | | |
| | | |
| | | |
| | |
| Marketable securities held in Trust Account | |
$ | 12,841,399 | | |
$ | 12,841,399 | | |
$ | — | | |
$ | — | |
| | |
| | | |
| | | |
| | | |
| | |
| Liabilities: | |
| | | |
| | | |
| | | |
| | |
| Warrant liabilities | |
$ | 17,676 | | |
$ | — | | |
$ | 17,676 | | |
$ | — | |
NOTE 8 — INCOME
TAXES
The Company’s
effective tax rate for the three months ended June 30, 2023 and 2022 was 7% and 0%, respectively. The Company’s
effective tax rate for the six months ended June 30, 2023 and 2022, was 6% and 0%, respectively. The Company’s
effective tax rate differs from the statutory income tax rate of 21% primarily due to the recording of a full valuation allowance
on deferred tax assets.
The Company
has evaluated its income tax positions and has determined that it does not have any uncertain tax positions. The Company will recognize
interest and penalties related to any uncertain tax positions through its income tax expense.
The Company
files income tax returns in the U.S. and Delaware jurisdictions and is subject to examination by the various taxing authorities since
inception.
On August 16,
2022, President Biden signed into law the Inflation Reduction Act of 2022, which includes a 15% minimum tax on the adjusted
financial statement income of corporations with a three taxable year average annual adjusted financial statement income in excess of $1 billion,
a 1% excise tax on net stock repurchases made by publicly traded US corporations and several tax incentives to promote clean energy.
The alternative minimum tax and the excise tax are effective in taxable years beginning after December 31, 2022. While these
tax law changes have no immediate effect and are not expected to have a material adverse effect on our results of operations going forward,
we will continue to evaluate its impact as further information becomes available.
ABRI SPAC I, INC.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2023
(Unaudited)
NOTE 9 — SUBSEQUENT
EVENTS
Management
evaluated subsequent events and transactions that occurred after the balance sheet date, up to the date that the financial statements
were issued. Based upon this review, other than as set forth below, management did not identify any subsequent events that would have
required adjustment or disclosure in the financial statements.
On July 11,
2023, the Company entered into a convertible promissory note with its Sponsor for aggregate principal amount of $100,000. The notes is
non-interest bearing, unsecured and payable on the date the Company consummates a Business Combination. In the event that a Business
Combination does not close prior to February 12, 2024, the notes shall be deemed terminated and no amounts will be owed. At any time,
up to a day prior to the closing of an Initial Business Combination, the holder may convert the principal amounts into private units
of the Company at a conversion price of $10.00 per unit.
On July 31,
2023, the Company entered into a convertible promissory note with its Sponsor for aggregate principal amount of $11,250. The notes is
non-interest bearing, unsecured and payable on the date the Company consummates a Business Combination. In the event that a Business
Combination does not close prior to February 12, 2024, the notes shall be deemed terminated and no amounts will be owed. At any time,
up to a day prior to the closing of an Initial Business Combination, the holder may convert the principal amounts into private units
of the Company at a conversion price of $10.00 per unit.
On July 10,
2023, the Company entered into a sixth promissory note with its Sponsor of a principal amount received of $87,500 to extend the time
available for the Company to consummate its Initial Business Combination. The note is non-interest bearing, unsecured and payable
on the date the Company consummates an Initial Business Combination.
On August 7,
2023, the Company held a special meeting of stockholders to extend the time to complete a business combination from August 12, 2023
to February 12, 2024 with no additional payment to the Company’s trust account. In connection with the stockholders’
vote, 570,224 shares were tendered for redemption. As a result, $6,055,325 ($10.62 per share), after deducting allowable
taxes, will be removed from the Company’s Trust Account to pay such holders. Following the redemptions, the Company will have 682,148 public
shares of common stock outstanding and $7,243,869 shall remain in the Trust Account.
REPORT OF INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM
To the Shareholders and Board
of Directors of DLQ, Inc.
Opinion on the Financial
Statements
We have
audited the accompanying carve-out consolidated balance sheets of DLQ, Inc. (the “Company”) as of December 31, 2022
and 2021, and the related carve-out consolidated statements of operations, stockholder’s equity, and cash flows for the years
then ended, and the related notes (collectively referred to as the carve-out consolidated financial statements). In our opinion,
the carve-out consolidated financial statements present fairly, in all material respects, the financial position of the Company as
of December 31, 2022 and 2021, and the results of its operations and cash flows for the years then ended, in conformity with
accounting principles generally accepted in the United States of America.
Restatement of the 2022
and 2021 Financial Statements
As disclosed
in Note 2 to the carve-out consolidated financial statements, the accompanying carve-out consolidated financial statements
as of and for the years ended December 31, 2022 and 2021 have been restated to correct misstatements.
Substantial Doubt About
the Company’s Ability to Continue as a Going Concern
The accompanying
carve-out consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed
in Note 2 to the carve-out consolidated financial statements, the Company has incurred net losses and negative cash flows that
raise substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are also
described in Note 2. The carve-out consolidated financial statements do not include any adjustments that might result from the
outcome of this uncertainty.
Basis for Opinion
These
carve-out consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express
an opinion on the Company’s carve-out consolidated financial statements based on our audits. 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 audits in accordance with the standards of the PCAOB and auditing standards generally accepted in the United States of America
(GAAS). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the carve-out consolidated
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 audits, 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 audits
included performing procedures to assess the risks of material misstatement of the carve-out consolidated 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 carve-out consolidated financial statements. Our audits also included evaluating the
accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the carve-out consolidated
financial statements. We believe that our audits provide a reasonable basis for our opinion.
We have served as the Company’s auditor
since 2022.
Tampa, Florida
April 28, 2023, except for the restatement paragraph of Note 2 as to which the date is June 16, 2023
DLQ INC.
CONSOLIDATED FINANCIAL STATEMENTS
Carve-out Consolidated
Balance Sheets
| | |
December 31, 2022 | | |
December 31, 2021 | |
| ASSETS | |
| | | |
| | |
| Current assets | |
| | | |
| | |
| Cash and cash equivalents | |
$ | 417,074 | | |
$ | 826,152 | |
| Accounts receivable, net | |
| 1,436,545 | | |
| 3,954,318 | |
| Other current assets | |
| 31,591 | | |
| 41,926 | |
| Total current assets | |
| 1,885,210 | | |
| 4,822,396 | |
| | |
| | | |
| | |
| Related party receivable | |
| 3,779,924 | | |
| 2,150,000 | |
| Right of use assets – operating lease | |
| 58,122 | | |
| 206,349 | |
| Intangible assets, net | |
| 6,755,312 | | |
| 5,190,096 | |
| Property and equipment, net | |
| 85,430 | | |
| 131,996 | |
| Goodwill | |
| 5,991,208 | | |
| 5,991,208 | |
| Total assets | |
$ | 18,555,206 | | |
$ | 18,492,045 | |
| | |
| | | |
| | |
| LIABILITIES AND STOCKHOLDER’S EQUITY | |
| | | |
| | |
| Current liabilities | |
| | | |
| | |
| Accounts payable | |
$ | 2,644,856 | | |
$ | 1,370,959 | |
| Accrued expenses | |
| 1,508,373 | | |
| 1,156,085 | |
| Total current liabilities | |
| 4,153,229 | | |
| 2,527,044 | |
| | |
| | | |
| | |
| Related party payable | |
| 7,863,129 | | |
| 6,325,000 | |
| Lease liability – operating lease | |
| 16,589 | | |
| 206,349 | |
| Notes payable | |
| 216,329 | | |
| — | |
| Total liabilities | |
$ | 12,249,276 | | |
$ | 9,058,393 | |
| | |
| | | |
| | |
| STOCKHOLDER’S EQUITY | |
| | | |
| | |
| Common Stock, par value $0.001, 2,000 shares authorized, issued, and outstanding | |
| — | | |
| — | |
| Additional paid-in capital | |
| 20,347,165 | | |
| 17,909,570 | |
| Accumulated deficit | |
| (14,041,235 | ) | |
| (8,475,918 | ) |
| Total stockholder’s equity | |
| 6,305,930 | | |
| 9,433,652 | |
| Total liabilities and stockholder’s equity | |
$ | 18,555,206 | | |
$ | 18,492,045 | |
The accompanying notes are
an integral part of these carve-out consolidated financial statements.
DLQ INC.
CONSOLIDATED FINANCIAL STATEMENTS
Carve-out Consolidated
Statements of Operations
| | |
For the years ended
December 31, | |
| | |
2022 | | |
2021 | |
| Revenue | |
$ | 20,235,536 | | |
$ | 22,792,189 | |
| | |
| | | |
| | |
| Operating expenses: | |
| | | |
| | |
| Platform operations | |
| 16,370,316 | | |
| 16,392,490 | |
| Depreciation and amortization | |
| 1,410,961 | | |
| 971,517 | |
| General and administrative | |
| 6,729,611 | | |
| 9,193,718 | |
| Sales and marketing | |
| 1,205,233 | | |
| 1,075,176 | |
| Technology and development | |
| — | | |
| 260,952 | |
| Total operating expenses | |
| 25,716,121 | | |
| 27,893,853 | |
| | |
| | | |
| | |
| Loss from operations | |
| (5,480,585 | ) | |
| (5,101,664 | ) |
| | |
| | | |
| | |
| Gain of forgiveness of PPP loan | |
| — | | |
| 503,700 | |
| Interest expense | |
| (84,790 | ) | |
| — | |
| Interest income | |
| 58 | | |
| 62,653 | |
| | |
| | | |
| | |
| Net loss before income tax | |
| (5,565,317 | ) | |
| (4,535,311 | ) |
| Income taxes | |
| — | | |
| — | |
| Net loss | |
$ | (5,565,317 | ) | |
$ | (4,535,311 | ) |
| | |
| | | |
| | |
| Net loss per share: Basic and Diluted | |
$ | (2,783 | ) | |
$ | (2,268 | ) |
| Weighted average common shares outstanding(1): | |
| | | |
| | |
| Basic and Diluted | |
| 2,000 | | |
| 2,000 | |
| (1) | Loss per share amounts have been revised for the years ended December
31, 2022 and 2021 to use the historical weighted-average common shares outstanding as opposed to pro-forma weighted-average common
shares outstanding. See restatement paragraph of Note 2. |
The accompanying notes are
an integral part of these carve-out consolidated financial statements.
DLQ INC.
CONSOLIDATED FINANCIAL STATEMENTS
Carve-out Consolidated
Statements of Stockholder’s Equity
For the Years Ended December 31, 2022, and 2021
| | |
Common Stock | | |
Additional Paid-In | | |
Accumulated | | |
Stockholder’s | |
| | |
Shares | | |
Amount | | |
Capital | | |
Deficit | | |
Equity | |
| Balance December 31, 2020 | |
| 2,000 | | |
$ | — | | |
$ | 14,741,928 | | |
$ | (3,940,607 | ) | |
$ | 10,801,321 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Share-based compensation | |
| — | | |
| — | | |
| 3,167,642 | | |
| — | | |
| 3,167,642 | |
| Net loss | |
| — | | |
| — | | |
| — | | |
| (4,535,311 | ) | |
| (4,535,311 | ) |
| Balance December 31, 2021 | |
| 2,000 | | |
$ | — | | |
$ | 17,909,570 | | |
$ | (8,475,918 | ) | |
$ | 9,433,652 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Acquisition of Battle Bridge | |
| — | | |
| — | | |
| 2,679,612 | | |
| — | | |
| 2,679,612 | |
| Share-based compensation | |
| — | | |
| — | | |
| (242,017 | ) | |
| — | | |
| (242,017 | ) |
| Net loss | |
| — | | |
| — | | |
| — | | |
| (5,565,317 | ) | |
| (5,565,317 | ) |
| Balance December 31, 2022 | |
| 2,000 | | |
$ | — | | |
$ | 20,347,165 | | |
$ | (14,041,235 | ) | |
$ | 6,305,930 | |
The accompanying notes are
an integral part of these carve-out consolidated financial statements.
DLQ INC.
CONSOLIDATED FINANCIAL STATEMENTS
Carve-out Consolidated
Statements of Cash Flows
| | |
For the year ended
December 31, | |
| | |
2022 | | |
2021 | |
| CASH FLOW FROM OPERATING ACTIVITIES: | |
| | | |
| | |
| Net loss | |
$ | (5,565,317 | ) | |
$ | (4,535,311 | ) |
| Adjustments to reconcile net loss to net cash used by operating activities: | |
| | | |
| | |
| Depreciation expense | |
| 46,565 | | |
| 46,565 | |
| Amortization expense | |
| 1,364,395 | | |
| 924,952 | |
| Share-based compensation | |
| (242,017 | ) | |
| 3,167,642 | |
| Bad debt expense | |
| 447,158 | | |
| 100,972 | |
| Non-cash operating lease expense | |
| 148,227 | | |
| 150,618 | |
| Gain of forgiveness of PPP | |
| — | | |
| (503,700 | ) |
| Changes in operating assets and liabilities: | |
| | | |
| | |
| Accounts receivable | |
| (232,585 | ) | |
| (1,475,178 | ) |
| Other current assets | |
| 10,334 | | |
| (28,805 | ) |
| Accounts payable | |
| 1,273,897 | | |
| 368,682 | |
| Lease liability – operating lease | |
| (189,760 | ) | |
| (150,618 | ) |
| Accrued expenses | |
| 352,291 | | |
| 619,805 | |
| Net cash used in operating activities | |
| (2,586,812 | ) | |
| (1,314,376 | ) |
| | |
| | | |
| | |
| INVESTING ACTIVITIES: | |
| | | |
| | |
| Cash paid for acquisition of Battle Bridge | |
| (50,000 | ) | |
| — | |
| Net cash used in investing activities | |
| (50,000 | ) | |
| — | |
| | |
| | | |
| | |
| FINANCING ACTIVITIES: | |
| | | |
| | |
| Funding from related party | |
| 1,338,129 | | |
| 3,975,000 | |
| Proceeds from factor | |
| 2,519,530 | | |
| — | |
| Additional funding to related party | |
| (1,629,925 | ) | |
| (2,000,000 | ) |
| Net cash provided by financing activities | |
| 2,227,734 | | |
| 1,975,000 | |
| | |
| | | |
| | |
| (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS | |
| (409,078 | ) | |
| 660,624 | |
| | |
| | | |
| | |
| CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR | |
| 826,152 | | |
| 165,528 | |
| CASH AND CASH EQUIVALENTS, END OF YEAR | |
$ | 417,074 | | |
$ | 826,152 | |
| | |
| | | |
| | |
| Supplemental disclosure of non-cash flow investing and financing activities: | |
| | | |
| | |
| Cash payment by Logiq, Inc. for the Battle Bridge acquisition | |
$ | 200,000 | | |
| — | |
| Issuance of stock related to acquisition of Battle Bridge | |
$ | 2,679,612 | | |
| — | |
The accompanying notes are
an integral part of these carve-out consolidated financial statements.
DLQ INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 — ORGANIZATION
AND BUSINESS DESCRIPTION
Corporate Information
and Business Overview
DLQ INC.
(the “Company”) is a Nevada corporation, originally incorporated in December 2019 as Origin 8, Inc. It is a
wholly owned subsidiary of Logiq, Inc. (formally known as Weyland Tech Inc.), a Delaware corporation that incorporated in 2004, whose
common stock is quoted on the OTCQX (over-the-counter exchange) Market under the ticker symbol, “LGIQ”. The Company has
two wholly owned subsidiaries, Tamble, Inc. and Push Interactive, LLC, and is located in Minneapolis, Minnesota, USA.
Tamble,
Inc. is not an operating business. Its sole purpose is to hire independent contractors for the Company’s marketing business.
On January 8,
2020, Logiq, Inc. completed the acquisition of substantially all of the assets of Push Holdings, Inc. and the assets were transferred
to Push Interactive, LLC. This acquired business operates a consumer data management platform powered by lead generation, online
marketing, and multichannel reengagement strategies through its owned and operated brands. The Company has developed a proprietary data
management platform and integrated with several third-party service providers to optimize the return on its marketing efforts. The
Company focuses on consumer engagement and enrichment to maximize its return on acquisition through repeat monetization of each consumer.
As part of the transaction, Logiq, Inc. issued 35,714,285 shares to Conversion Point Technologies, Inc. as consideration for
the acquisition of all the assets of Push Holdings, Inc. in the amount of $14,285,714.
On March 31,
2022, the Company completed the acquisition of certain customer contractual agreements of Battle Bridge Labs, LLC, including those of
Section 2383 LLC, a Tulsa, Oklahoma based digital brand marketing agency. The purchase price was $2,929,612 and consisted of the
issuance of 2,912,621 shares of restricted common stock of Logiq, Inc. with a fair value of $2,679,612 and cash consideration of
$250,000, of which Logiq, Inc. paid $200,000 and DLQ paid $50,000, respectively.
Battle
Bridge Acquisition Co., LLC became the third wholly owned subsidiary of the Company. Battle Bridge is a full-service branding and
digital marketing agency serving both external clients and internal parts of the Company. Battle Bridge offers branding and identity development
in additional to digital strategy and media busing services, as well as all of the requisite ancillary and supporting services to enable
the branding and digital practices.
On September 9,
2022, the Company entered into a definitive merger agreement for a business combination whereby it will merge with Abri Merger Sub Inc.,
a wholly owned subsidiary of Abri SPAC I, Inc., a special purpose acquisition company (“SPAC”). Upon closing of the business
combination, the company is expected to remain NASDAQ-listed under the name of the Company.
The business
combination between Abri and the Company will be affected through the merger of Abri Merger Sub, Inc. with and into the Company, with
the Company surviving the merger as a wholly owned subsidiary of Abri. Upon the closing of the acquisition, the Company plans to change
its name to “Collective Audience, Inc.” Abri will issue 11.4 million shares in exchange for all of the outstanding shares
of the Company. At $10 per Abri share, the valuation of the Company is $114 million. The Board of Directors of Logiq, Inc. and Abri,
have unanimously approved the transaction. Closing the transaction will require the approval of both Logiq and Abri stockholders. All
cash remaining in Abri’s trust account immediately after the closing of the business combination will be available to the surviving
entity for working capital, growth and other general corporate purposes. The transaction is expected to close in the second quarter of
2023.
The accompanying
carve-out consolidated financial statements represent the financial position and result of operations of the Company as a carve-out of
Logiq, Inc.
DLQ INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 2 — SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION AND
PRINCIPLES OF CONSOLIDATION
The carve-out consolidated
financial statements have been prepared in accordance with the accounting principles generally accepted in the United States of America
(“US GAAP”). The consolidated financial statements reflect the assets, liabilities, revenue and expenses directly attributable
to the Company. The Company is a separate legal entity and as such, general and administrative costs have been recorded directly to the
books and records of the Company on a specific identification basis. Certain corporate overhead costs have been recorded based upon expenses
directly attributable to the Company. Management believes all costs have been appropriately recorded.
RESTATEMENT
In the
previously issued audited carveout consolidated financial statements for the year ended December 31, 2022 and 2021, included in the
Registration Statement on Form S-4 of Abri SPAC 1, Inc. (File No. 333-268133), the Company calculated a loss per share using
pro-forma weighted-average common shares outstanding. It was determined that the Company should have calculated the loss per
share using the historical weighted-average shares outstanding. The following table present the effect of the restatement on the
carve-out consolidated statements of operations for the years ended December 31, 2022 and 2021:
| | |
Year Ended
December 31,
2022 | | |
Year Ended
December 31,
2021 | |
| Net Loss | |
$ | (5,565,317 | ) | |
$ | (4,535,311 | ) |
| | |
| | | |
| | |
| Revised presentation in S-4/A3 (using historical shares) | |
| | | |
| | |
| Weighted-average common shares outstanding – Basic and Diluted | |
| 2,000 | | |
| 2,000 | |
| Pro-forma net loss per share – Basic and Diluted | |
$ | (2,784 | ) | |
$ | (2,268 | ) |
| | |
| | | |
| | |
| Original presentation in S-4/A2 (using pro-forma shares) | |
| | | |
| | |
| Weighted-average common shares outstanding – Basic and Diluted | |
| 15,288,078 | | |
| 15,288,078 | |
| Pro-forma net loss per share – Basic and Diluted | |
$ | (0.36 | ) | |
$ | (0.30 | ) |
USE OF ESTIMATES
The preparation
of the Company’s carve-out consolidated financial statements in conformity with US GAAP requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the
date of the carve-out consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.
Management makes its best estimate of the ultimate outcome for these items based on historical trends and other information available
when the carve-out consolidated financial statements are prepared. Actual results could differ from those estimates.
BUSINESS COMBINATIONS
The Company
allocates the purchase price of the acquisition to the tangible assets, liabilities and identifiable intangible assets acquired based
on their estimated fair values. The excess of the purchase price over those fair values is recorded as goodwill. Acquisition related expenses
and integration costs are expensed as incurred.
SEGMENT REPORTING
Operating
segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation
by the chief operating decision maker, the Chief Executive Officer, in making decisions regarding resource allocation and assessing performance.
The Company views its operations and manages its business as one operating segment in the United States.
DLQ INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 2 — SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
FAIR VALUE OF FINANCIAL INSTRUMENTS
The assets
are valued using a fair market basis as defined in the Financial Accounting Standards Board (FASB ASC 820, Fair Value Measurement).
Fair value is the price the Company would receive to sell an asset or pay to transfer a liability in an orderly transaction with a market
participant at the measurement date. The Company uses a three-level hierarchy established by the Financial Accounting Standards Board
(FASB) that prioritizes fair value measurements based on the types of inputs used for the various valuation techniques (market approach,
income approach and cost approach). The levels of the fair value hierarchy are described below:
| |
|
Level 1: |
|
Quoted prices in active markets for identical assets or liabilities.
|
| |
|
Level 2: |
|
Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly; these include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active.
|
| |
|
Level 3: |
|
Unobservable inputs with little or no market data available, which require the reporting entity to develop its own assumptions. |
The Company’s
assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors
specific to the asset or liability. Financial assets and liabilities are classified in their entirety based on the most conservative level
of input that is significant to the fair value measurement. The fair value of certain assets and liabilities assumed in the acquisition
of Push Holdings, Inc. were determined utilizing the level 3 inputs.
LIQUIDITY
The Company
requires substantial amounts of operating cash for operating activities, including salaries and wages paid to the employees and contractors,
general and administrative expenses, and others. As of December 31, 2022, the Company had $417,074 in cash and cash equivalents.
The Company
incurred operating losses and generated negative cash flows from operating activities during the years ended December 31, 2022
and 2021. For the years ended December 31, 2022 and 2021, the Company incurred net losses of $5,565,317 and $4,535,311,
respectively, and had cash used in operations of $2,586,812 and $1,314,376, respectively. These factors raise substantial doubt about
the Company’s ability to continue as a going concern within one year after the date that the carve-out consolidated financial
statements were available to be issued.
The Company
considers operating results, capital resources and financial position, in combination with current projections and estimates, as part
of its plan to fund operations over a reasonable period of time. The future viability of the company beyond 2022 is largely dependent
on funding from Logiq, Inc. or additional sources of financing.
Management
of DLQ will explore strategic alliances with enterprise investors that have a specific investment focus on digital marketing, advertising
technology and lead generation companies. DLQ is already acquainted with investment groups that have portfolio companies which could form
strategic investment/partnerships with DLQ. DLQ will explore these opportunities after the Business Combination.
While
it is anticipated that one of the above will provide assistance to address the liquidity concerns, these carve-out consolidated financial
statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification
of liabilities that might result from this uncertainty.
There
can be no assurance that the Company will be able to raise additional funds or that the terms and conditions of any future financing will
be workable or acceptable to the Company or its stockholders. If the Company is unable to fund its operations from existing cash on hand,
operating cash flows, additional borrowings, or raising equity capital, the Company may not continue operations.
DLQ INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 2 — SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
RISKS AND UNCERTAINTIES
The Company
relies on cloud-based hosting through a global accredited hosting provider. Management believes that alternate sources are available;
however, disruption or termination of this relationship could adversely affect our operating results in the near-term.
GOODWILL
Goodwill
is recorded as the difference between the aggregate consideration in a business combination and the fair value of the acquired net tangible
and intangible assets. The Company evaluates goodwill for impairment on an annual basis in the fourth quarter or more frequently if indicators
of impairment exist that would more likely than not reduce the fair value of a reporting unit below its carrying amount. The Company first
assesses qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its
carrying value. Based on that qualitative assessment, if it is more likely than not that the fair value of a reporting unit is less than
its carrying value, the Company conducts a quantitative goodwill impairment test, which involves comparing the estimated fair value of
the reporting unit with its carrying value, including goodwill. The Company estimates the fair value of a reporting unit using a combination
of the income and market approach. If the carrying value of the reporting unit exceeds its estimated fair value, an impairment loss is
recorded for the difference. There were no impairments recorded for years ended December 31, 2022 and 2021.
INTANGIBLE ASSETS
The Company’s
intangible assets consist of a trademark name and software technology that was acquired as part of the acquisition of Push Holdings, Inc.
as well as the customer list acquired as part of the Battle Bridge acquisition. The trademark name is amortized using the straight-line method
over 15 years. The software is amortized using the straight-line method over 7 years. The customer contractual agreements
are amortized using the straight-line method over 5 years.
IMPAIRMENT OF LONG-LIVED
ASSETS
The Company
classifies its long-life assets into: (i) computer and office equipment; (ii) furniture and fixtures, (iii) leasehold
improvements, and (iv) finite life intangible assets.
The Company
evaluates the recoverability of long-lived assets annually, or more frequently whenever events or changes in circumstances indicate
the assets might be impaired. If the carrying value of the long-life asset is not recoverable on a future cash flow basis, an impairment
is recognized. As of December 31, 2022, and December 31, 2021, the Company had recorded no impairment charges.
LEASE
The Company
adopted ASU 2016-02, Leases (Topic 842), on January 8, 2020, using a modified retrospective approach reflecting the application
of the standard to leases existing at, or entered into after, the beginning of the earliest comparative period presented in the carve-out consolidated
financial statements.
The Company
leases its offices which are classified as operating leases in accordance with Topic 842. Under Topic 842, lessees are required
to recognize the following for all leases (with the exception of short-term leases) on the commencement date: (i) lease liability,
which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis; and (ii) right-of-use asset,
which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term.
At the
commencement date, the Company recognizes the lease liability at the present value of the lease payments not yet paid, discounted using
the interest rate implicit in the lease or, if that rate cannot be readily determined, the Company’s incremental borrowing rate
for the same term as the underlying lease. The right-of-use asset is recognized at the present value of future lease payments. There
were no impairments recorded for the years ended December 31, 2022 and 2021. (Refer to NOTE 11 — COMMITMENTS
AND CONTINGENCIES)
DLQ INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 2 — SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
ACCOUNTS RECEIVABLE
Accounts
receivable consists of trade receivables from customers. The Company records accounts receivable at its net realizable value, recognizing
an allowance for doubtful accounts based on our best estimate of probable credit losses on our existing accounts receivable. The Company
individually reviews all balances that exceed 90 days from the invoice date and assess for provisions for doubtful accounts based
on an assessment of the balance that will be collected. Balances are written off against the allowance after all means of collection have
been exhausted and the possibility of recovery is considered remote.
The allowance
for doubtful accounts as of December 31, 2022, and 2021, amounts to $602,751 and $155,592, respectively. Bad debt expense for the years
ended December 31, 2022, and 2021, amounted to $447,159 and $121,529, respectively, and are included in G&A in the accompanying
carve-out consolidated statement of operations.
ACCOUNTS RECEIVABLE AND DUE
TO FACTOR
The Company
factors designated trade receivables pursuant to a factoring agreement with Bayview Funding LLC, and unrelated factor (the “Factor”).
The agreement specifies that eligible trade receivables are factored with recourse. The Company submits selected trade receivables to
the factor and receives up to 85% of the face value of the receivable by wire transfer or ACH. The Factor withholds 15% as retainage.
Upon payment by the customer, the Company receives the remainder of the amount due from the factor.
Trade
receivables assigned to the Factor are carried at the original invoice amount less an estimate made for doubtful accounts. Under the terms
of the recourse provision, the Company is required to reimburse the Factor for factored receivables that are not paid on time. Accordingly,
these receivables are accounted for as a secured financing arrangement and not as a sale of financial assets. The allowance of doubtful
accounts is based on management regular evaluation of individual customer’s receivables and consideration of a customer’s
financial condition and credit history. Trade receivables are written off when deemed uncollectable. Recoveries of trade receivables previously
written off are recorded when received.
The Company
presents the receivables, net of allowances, as current assets and presents the amount potentially due to the Factor as a secured financing
in the current liabilities.
Of the
total accounts receivable at year-end, the total amount of receivables factored with recourse was $270,599 for the year ended December 31,
2022. There were no factored receivables for the year ended December 31, 2021.
CASH AND CASH EQUIVALENTS
Cash and
cash equivalents represent cash on hand, demand deposits, and other short-term highly liquid investments placed with banks, which
have original maturities of three months or less and are readily convertible to known amounts of cash.
CONCENTRATIONS OF RISK
The Company’s
financial instruments are potentially subject to concentrations of credit risk. The Company places its cash with high quality credit institutions.
From time to time, the Company maintains cash balances at certain institutions in excess of the FDIC limit. Management believes that the
risk of loss is not significant and has not experienced any losses in such accounts.
Approximately 53%
of revenues were generated from two customers and 21% of gross revenues were generated from three customers during the years ended
December 2022 and 2021, respectively.
As of
December 31, 2022, and 2021, one customer represented 10% and two customers represented 48% of accounts receivable, respectively.
As of
December 31, 2022, there were no significant vendors as compared to December 31, 2021 where three vendors represented approximately
60% of accounts payable.
DLQ INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 2 — SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
REVENUE RECOGNITION
The Company
generates revenue derived from managed service contracts in accordance with Accounting Standards Update 2014-09, Revenue from Contracts
with Customers (Topic ASC 606) (Refer to NOTE 5 — REVENUE RECOGNITION).
INCOME TAXES
The Company
uses the asset and liability method of accounting for income taxes in accordance with Accounting Standards Codification 740, “Income
Taxes” (“ASC 740”). Under this method, income tax expense is recognized as the amount of: (i) taxes payable
or refundable for the current year and (ii) future tax consequences attributable to differences between carve-out consolidated
financial statements carrying amounts of existing assets and liabilities 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 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 the results of
operations in the period that includes the enactment date. A valuation allowance is provided to reduce the deferred tax assets reported
if based on the weight of available evidence it is more likely than not that some portion or all of the deferred tax assets will not be
realized.
The Company
is subject to Income tax filings requirements in U.S. federal and various state jurisdictions. The Company’s tax returns for years
from 2019, 2020, and 2021 are subject to U.S. federal, state, and local income tax examinations by tax authorities.
The Company
reports income tax related interest and penalties within our income tax line item on our consolidated statements of operations. We likewise
report the reversal of income tax-related interest and penalties within such line item to the extent we resolve our liabilities for
uncertain tax positions in a manner favorable to our accruals.
SHARE-BASED COMPENSATION
Compensation
expense related to employee awards is measured and recognized in the carve-out consolidated financial statements based on the fair
value of the awards granted. The Company awarded restricted stock to employees at the fair value of the underlying stock on the grant
date. The Company also awarded restricted stock units (“RSU”) that are recognized over the required service term on a straight-line basis,
based on the fair value of the underlying stock of the grant date. Forfeitures are recorded as they occur. (Refer to NOTE 9 — STOCKHOLDER’S
EQUITY)
TECHNOLOGY AND DEVELOPMENT
COSTS
Technology
and development costs are expensed as incurred and consist primarily of salaries and related expenses, consulting services and other direct
expenses. Research and development costs for the years ended December 31, 2022, and 2021, amounted to $0 and $260,952, respectively.
RECENT ACCOUNTING PRONOUNCEMENTS
Management
does not believe that any recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material
effect on the Company’s carve-out consolidated financial statements.
NOTE 3 — ACQUISITION
On March 31,
2022, the Company completed the acquisition of certain customer contractual agreements of Battle Bridge Labs, LLC, including those of
Section 2383 LLC, a Tulsa, Oklahoma-based digital brand marketing agency. Under ASC 805 Business Combinations, the assets
acquired do not meet the definition of a business. As such, the Company has accounted for the transaction as an asset acquisition. The
purchase price for the acquired assets was $2,929,612 and consisted of the issuance of 2,912,621 shares of restricted common stock
of Logiq, Inc. with a fair value of $2,679,612 and cash consideration of $250,000.
Based
upon a thorough analysis to determine the relative fair value of the assets acquired and the liabilities assumed, the purchase price for
the acquisition has been allocated entirely to the customer agreements. These intangible assets were valued using the income approach.
DLQ INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 4 — INTANGIBLE
ASSETS, NET
Intangibles,
net, consists of the following as of December 31:
| | |
2022 | | |
2021 | |
| Trademarks/Names | |
$ | 1,060,000 | | |
$ | 1,060,000 | |
| Software | |
| 5,980,000 | | |
| 5,980,000 | |
| Customer list | |
| 2,929,612 | | |
| — | |
| Less accumulated amortization | |
| (3,214,300 | ) | |
| (1,849,904 | ) |
| Intangibles, net | |
$ | 6,755,312 | | |
$ | 5,190,096 | |
The estimated
future amortization of intangible assets as of December 31, 2022, is as follows:
| | 2023 | | |
| 1,510,874 | |
| | 2024 | | |
| 1,510,874 | |
| | 2025 | | |
| 1,510,874 | |
| | 2026 | | |
| 1,510,874 | |
| | 2027 | | |
| 217,148 | |
| | Thereafter | | |
| 494,668 | |
| | | | |
$ | 6,755,312 | |
The amortization
expense totalled $1,364,395 and $924,952 for each of the years ended December 31, 2022, and 2021, respectively.
NOTE 5 — REVENUE
RECOGNITION
ASC 606, Revenue
from Contracts with Customers
Under
ASC 606, revenue is recognized when a customer obtains control of promised goods or services in an amount that reflects the consideration
the Company expects to receive in exchange for those goods or services. The Company measures revenue based on the consideration specified
in the customer arrangement, and revenue is recognized when the performance obligations in the customer arrangement are satisfied. A performance
obligation is a promise in a contract to transfer a distinct service or product to the customer. The transaction price of a contract is
allocated to each distinct performance obligation and recognized as revenue when or as the customer receives the benefit of the performance
obligation.
In determining
the appropriate amount of revenue to be recognized as it fulfils its obligations under its agreements, the Company performs the following
steps (i) identification of contracts with customers; (ii) identification of performance obligations; (iii) determination
of the transaction price; (iv) allocation of the transaction price to performance obligations; and (v) recognition of revenue
when or as the Company satisfies each performance obligation.
Typical
payment terms are between net 30 and net 60 days.
The Company
negotiates managed service agreements with the customers to specify the terms and conditions (including rights and obligations) and services
to be provided. The services provided are based on three primary streams of revenue: lead generation, affiliate management and reengagement.
Lead Generation Revenue
For its
Lead Generation revenue, the Company provides leads by purchasing ads to direct consumers to specific pages which are auctioned to the
customer base. The Company’s performance obligation is to deliver the leads to customers in accordance with the terms of the agreement.
The Company has concluded that this constitutes a single performance obligation for financial reporting purposes and that such obligation
is recognized at a point of time, for which the Company is transferring value to the customer through delivery.
DLQ INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 5 — REVENUE
RECOGNITION (cont.)
Affiliate Management
Revenue
For its
Affiliate Management revenue, the Company places ads on behalf of its customers after identifying the appropriate platforms to place the
ads, determining the most advantageous amount of ad spend per platform, determining the prices for each ad, and producing the marketing
materials. The Company has concluded that this constitutes a single performance obligation for financial reporting purposes and that such
obligation is recognized at a point of time, for which the Company is transferring value to the customer through delivery.
Reengagement Revenue
For its
Reengagement revenue, the Company provides links and advertisements via online, email, and In-App that generate views which are paid
for by the customer. The Company’s performance obligation is to deliver the activity of clicks on advertisements in accordance with
the terms of the agreement. The Company has concluded that this constitutes a single performance obligation for financial reporting purposes
and that such obligation is recognized at a point of time, for which the Company is transferring value to the customer through delivery.
All the
streams of revenue above are recorded on a gross basis. The Company is responsible for fulfilling the delivery of services, establishing
the selling price for the delivery, and the Company performs billing and collections, including ultimately retaining credit risk. The
Company therefore determined that is serves as a principal and that gross presentation of revenue is appropriate.
Revenue
consists of the following as of December 31:
| | |
Point in Time | |
| | |
2022 | | |
2021 | |
| Lead Generation | |
$ | 11,540,265 | | |
$ | 20,862,271 | |
| Affiliate Management | |
| 6,441,775 | | |
| — | |
| Reengagement | |
| 2,253,496 | | |
| 1,929,918 | |
| Revenue | |
$ | 20,235,536 | | |
$ | 22,792,189 | |
NOTE 6 — PROPERTY
AND EQUIPMENT, NET
Property
and equipment, net, consists of the following as of December 31:
| | |
2022 | | |
2021 | |
| Computer and equipment | |
$ | 59,169 | | |
$ | 59,169 | |
| Leasehold improvements | |
| 165,957 | | |
| 165,957 | |
| | |
| 225,126 | | |
| 225,126 | |
| Less accumulated depreciation | |
| (139,696 | ) | |
| (93,130 | ) |
| Property and equipment, net | |
$ | 85,430 | | |
$ | 131,996 | |
Depreciation
expense for the years ended December 31, 2022 and 2021, amounted to $46,565 for each year.
NOTE 7 — ACCRUED
EXPENSES
Accrued
expenses consist of the following as of December 31:
| | |
2022 | | |
2021 | |
| Credit Cards | |
$ | 604,661 | | |
$ | 591,685 | |
| Payroll | |
| 892,755 | | |
| 564,400 | |
| Other | |
| 10,957 | | |
| — | |
| Accrued expenses | |
$ | 1,508,373 | | |
$ | 1,156,085 | |
DLQ INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 8 — INCOME
TAX
The Company
is incorporated in the State of Nevada and is subject to a U.S. federal and state corporate income taxation. The Company is
not filing as a member of the U.S. consolidated group of Logiq Inc. and will file the US tax returns on a separate return basis.
The tax provision has been prepared using this filing profile and does not include any activity of any entities outside of DLQ Inc.
The Company
incurred net operating losses for the years ended December 31, 2022, and 2021. The Company is subject to U.S. federal corporate
income tax rate of 21% and estimated state tax rate of 9.80%.
As of
December 31, 2022, and 2021, this company does not have any net deferred tax assets.
Income
tax expense calculated by applying the federal statutory rate to the loss before income taxes for the year ended December 31, 2022,
and 2021, differs from the actual expense primarily due to the effect of applying the valuation allowance against the Company’s
net deferred tax assets, as well as the forgiveness of PPP loan proceeds for the period ended December 31, 2021.
| | |
2022 | | |
2021 | |
| Statutory tax rate | |
| 21.00 | % | |
| 21.00 | % |
| State income tax | |
| 9.80 | % | |
| 7.31 | % |
| Non-taxable PPP Loan Forgiveness | |
| — | % | |
| 3.18 | % |
| Nondeductible Expense | |
| — | % | |
| 0.00 | % |
| Change in Valuation Allowance | |
| (31.01 | )% | |
| (31.49 | )% |
| True-Up | |
| (0.21 | )% | |
| — | % |
| Change in State Rate | |
| — | % | |
| (31.49 | )% |
| Total | |
| (0.00 | )% | |
| 0.00 | % |
Deferred
income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial
reporting purposes and the amounts used for income tax purposes. Details of the Company’s deferred tax assets and liabilities as
of December 31 were as follows:
| Deferred Tax Assets and Liabilities | |
2022 | | |
2021 | |
| Allowance for Bad Debt | |
$ | 185,647 | | |
$ | 44,044 | |
| Deferred Payroll | |
| 58,336 | | |
| 33,895 | |
| Stock-based compensation | |
| 8,876 | | |
| 76,667 | |
| Depreciation | |
| (26,312 | ) | |
| (37,365 | ) |
| Amortization | |
| (644,524 | ) | |
| 103,476 | |
| Net Operating Loss | |
| 4,022,649 | | |
| 2,335,402 | |
| Valuation Allowance | |
| (3,604,672 | ) | |
| (2,556,119 | ) |
| Net Deferred Tax Assets | |
$ | — | | |
$ | — | |
Management
has determined that it is more likely than not that the Company will not realize its net deferred tax asset, and accordingly, a valuation
allowance has been deemed necessary. As of December 31, 2022, and 2021, respectively, the valuation allowance is $3,604,672 and $2,556,119.
The Company
reports income tax related interest and penalties within our income tax line item on our carve-out consolidated statements of operations.
We likewise report the reversal of income tax-related interest and penalties within such line item to the extent we resolve our liabilities
for uncertain tax positions in a manner favorable to our accruals. As of December 31, 2022, and 2021, the Company has not recorded
any uncertain tax positions.
NOTE 9 — STOCKHOLDER’S
EQUITY
Logiq,
Inc., the parent of the Company, authorized a 2020 Equity Incentive Plan, which provides the issuance of common stock and restricted stock
units (“RSU”) to be granted to eligible employees and consultants of Logiq, Inc., including those employed by DLQ, Inc.
DLQ INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 9 — STOCKHOLDER’S
EQUITY (cont.)
Logiq,
Inc. issued shares of common stock to certain employees and consultants of the Company for services rendered (the “Compensation
Awards”). The Compensation awards were issued at the grant date fair value derived from OCTQX, the top tier of the three marketplaces
for the OTC trading of stocks, under the symbol “LGIQ”. On August 28, 2020, a total of 16,000 shares were granted
at $7.68 per unit. On July 16, 2021, a total of 130,000 shares were granted at $2.38 per unit. On September 2, 2021, a
total of 483,814 shares were granted at $3.97 per unit. On April 28, 2022, a total of 100,000 shares were granted at $0.534
per unit. On July 8, 2022, a total of 250,000 shares were granted at $0.365 per unit.
RSU’s
vest ratably every six months over three years. In the event the participant ceases to be a service provider for any reason
before participant’s RSUs vest, the RSUs and participant’s right to acquire any shares will immediately terminate. To the
extent actual forfeiture occurs, the amount will be recorded as adjustment to compensation expense in the period in which it occurred.
On November 20, 2020, the Company granted 500,000 of RSUs to employees at $7.50 per unit. On July 16, 2021, one employee’s
RSUs were forfeited in exchange of 130,000 shares of common stock. On January 7, 2022, two employee’s RSUs were terminated,
and 200,000 non-vested shares were forfeited. On July 8, 2022, one employee’s RSUs were forfeited in exchange of 250,000 shares
of common stock. All RSU’s have been forfeited as of September 30, 2022, and no remaining shared-based compensation expense
is remaining for future periods. Going forward the Company will no longer issue RSU’s under the 2020 Equity Incentive Plan.
For the years
ended December 31, 2022, and 2021, the company recorded a recovery of $247,017 and an expense of $938,000 for stock-based compensation
related to the RSUs, respectively.
Total
shared-based compensation expense related to non-vested awards not yet recognized was approximately $1,729,000 as December 31,
2021.
The table
below reflects the RSU’s activity for the years ended December 31, 2022, and 2021:
| | | |
RSU’s | |
| Nonvested as of December 31, 2020 | | |
| 500,000 | |
| Granted | | |
| — | |
| Vested | | |
| (150,000 | ) |
| Forfeited | | |
| (83,333 | ) |
| Nonvested as of December 31,2021 | | |
| 266,667 | |
| Granted | | |
| — | |
| Vested | | |
| (16,667 | ) |
| Forfeited | | |
| (250,000 | ) |
| Nonvested as of December 31,2022 | | |
| — | |
NOTE 10 — LOSS
PER SHARE
Basic
loss per share is computed by dividing net income available to Common Stockholders (the numerator) by the weighted average number of Common
Stock outstanding for the period (the denominator). The computation of net loss per share as of December 31 is as follows:
| | |
2022 | | |
2021 | |
| Net Loss | |
$ | (5,565,317 | ) | |
$ | (4,535,311 | ) |
| | |
| | | |
| | |
| Weighted-average common shares outstanding – Basic and Diluted | |
| 2,000 | | |
| 2,000 | |
| Net loss per share – Basic and Diluted | |
$ | (2,782.66 | ) | |
$ | (2,267.66 | ) |
DLQ INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 11 — COMMITMENTS
AND CONTINGENCIES
Operating lease
In 2020,
through the Push acquisition, the Company was assigned an operating lease for approximately 30,348 square feet of office and warehouse
space located in Minneapolis, Minnesota, at a rate of $367,200 per annum. This lease was through a related party. The terms of the lease
acquired were to expire on December 31, 2021. On September 1, 2021, the operating lease was amended to reduce the square footage
leased to 26,954 at a rate of $26,300 per month. On November 1, 2021, the operating lease was amended to further reduce the square
footage leased to 12,422 at a rate of $17,500 per month and to expire on December 31, 2022; however, the lease was extended from
January 1, 2023 through April 30, 2023.
Based
on the present value of the lease payments for the remaining lease term acquired on January 8, 2020, the right-of-use assets
and lease liabilities were approximately $668,000 with an effective present value rate of 5.25%. Under the amended contract the operating
lease right-of-use and liabilities were approximately $206,000 at December 31, 2021, utilizing an effective present value rate
at 3.25%.
For the years
ended December 31, 2022, and 2021, the Company recorded approximately $3,600 and $10,000, respectively, in amortization expense.
The Company’s net rental expense was approximately $155,000 and $267,000 for the years ended December 31, 2022, and 2021,
respectively. During a portion of 2021, the Company had two sub-lease agreements under the master operating lease. As of December 31,
2021, the Company had no sub-lease agreements and had a future commitment of rental payments of $210,000 due during the year ended
December 31, 2022, which has been realized.
NOTE 12 — LEGAL
From time
to time, the Company is subject to various legal proceedings and claims, either asserted or unasserted, that arise in the ordinary course
of business. Although the outcome of the various legal proceedings and claims cannot be predicted with certainty, management does not
believe that any of these proceedings or other claims will have a material effect on the Company’s business, financial condition,
results of operations or cash flows.
NOTE 13 — RELATED
PARTIES
In both
2022 and 2021, the Company made advances to two related parties and obtained funding from Logiq, Inc. to support the operations of the
business. The related party receivable as of December 31, 2022 and 2021, amounts to approximately $3,779,924 and $2,200,000, respectively.
The related party payable as of December 31, 2022 and 2021, amount to approximately $7,863,000 and $6,325,000, respectively.
On November 8,
2022, the Company entered into a Managed Services Agreement (the “MSA”) with a significant new client (the “Client”)
and will provide certain affiliate management, website development, lead generation, email management, and search engine optimization
services (collectively, the “Services”) to Client through the Company’s platform. The MSA will terminate on October 31,
2023, provided that the term may be extended beyond such date by mutual written agreement of the parties. Notwithstanding the foregoing,
Client may terminate the MSA at any time after January 1, 2023, without cost or any penalty, in the event that it is dissatisfied
with the Services provided thereunder.
In connection
with the MSA, on November 8, 2022, DLQ Parent and Client also entered into an Independent Contractor Agreement (the “IC Agreement,”
and together with the MSA, the “Agreements”), pursuant to which Client will provide, on a non-exclusive basis, certain
business development strategies and execution and consulting services regarding e-commerce, digital marketing, and online advertising,
including lead generation, affiliate marketing and brand development to the Company. The term of the IC Agreement coincides with the term
of the MSA.
DLQ INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 13 — RELATED
PARTIES (cont.)
As compensation
for the services to be provided by Client to the Company under the IC Agreement, the Company agreed to issue Client 1,750,000 restricted
shares of Logiq, Inc. common stock (the “Initial Shares”) upon execution of the Agreements. In the event that the proposed
acquisition of a wholly owned subsidiary of the Company by Abri SPAC I, Inc., which proposed acquisition was previously disclosed
by the Company in that Current Report on Form 8-K filed with the Securities and Exchange Commission on September 12, 2022,
is not completed on or before April 1, 2023, then the Company shall issue Client an additional 1,750,000 restricted shares of
Logiq, Inc. common stock (such additional shares together with the Initial Shares, the “Registrable Shares”) as further contingent
consideration pursuant to the Agreements. In addition, the Company agreed to reimburse up to $25,000 of legal fees paid by Client in connection
with the Agreements.
The compensation
expense for the services rendered by the Client to the Company are born by the Company.
NOTE 14 — SUBSEQUENT
EVENTS
The Company
has evaluated subsequent events occurring through the date these financial statements were issued, for their potential impact on the carve-out consolidated
financial statements and disclosures and there were no subsequent events to report.
DLQ INC.
Carve-out Consolidated Balance Sheets
| | |
June 30,
2023 | | |
December 31,
2022 | |
| | |
(unaudited) | | |
| |
| ASSETS | |
| | | |
| | |
| Current assets | |
| | | |
| | |
| Cash and cash equivalents | |
$ | 475,278 | | |
$ | 417,074 | |
| Accounts receivable, net | |
| 837,460 | | |
| 1,436,545 | |
| Other current assets | |
| 31,591 | | |
| 31,591 | |
| Total current assets | |
| 1,344,329 | | |
| 1,885,210 | |
| | |
| | | |
| | |
| Related party receivable | |
| 3,784,133 | | |
| 3,779,924 | |
| Right of use assets – operating lease | |
| — | | |
| 58,122 | |
| Intangible assets, net | |
| 5,999,875 | | |
| 6,755,312 | |
| Property and equipment, net | |
| 63,420 | | |
| 85,430 | |
| Goodwill | |
| 5,991,208 | | |
| 5,991,208 | |
| Total assets | |
$ | 17,182,965 | | |
$ | 18,555,206 | |
| | |
| | | |
| | |
| LIABILITIES AND STOCKHOLDER’S EQUITY | |
| | | |
| | |
| Current liabilities | |
| | | |
| | |
| Accounts payable | |
$ | 1,942,829 | | |
$ | 2,644,856 | |
| Accrued expenses | |
| 1,921,076 | | |
| 1,508,373 | |
| Total current liabilities | |
| 3,863,905 | | |
| 4,153,229 | |
| | |
| | | |
| | |
| Related party payable | |
| 8,666,372 | | |
| 7,863,129 | |
| Lease liability – operating lease | |
| — | | |
| 16,589 | |
| Note payable | |
| 270,524 | | |
| 216,329 | |
| Total liabilities | |
| 12,800,801 | | |
| 12,249,276 | |
| | |
| | | |
| | |
| STOCKHOLDER’S EQUITY | |
| | | |
| | |
| Common Stock, par value $0.001, 2,000 shares authorized, issued, and outstanding | |
| — | | |
| — | |
| Additional Paid-in-Capital | |
| 21,012,915 | | |
| 20,347,165 | |
| Accumulated Deficit | |
| (16,630,751 | ) | |
| (14,041,235 | ) |
| Total stockholder’s equity | |
| 4,382,164 | | |
| 6,305,930 | |
| Total liabilities and stockholder’s equity | |
$ | 17,182,965 | | |
$ | 18,555,206 | |
The accompanying notes are
an integral part of these unaudited carve-out consolidated financial statements.
DLQ INC.
Carve-out Consolidated Statements of Operations (unaudited)
| | |
For the Six Months Ended
June 30, | |
| | |
2023 | | |
2022 | |
| Revenue | |
$ | 8,398,088 | | |
$ | 8,068,303 | |
| | |
| | | |
| | |
| Operating expenses: | |
| | | |
| | |
| Platform operations | |
| 7,582,899 | | |
| 5,877,152 | |
| Depreciation and amortization | |
| 777,447 | | |
| 632,238 | |
| General and administrative | |
| 2,481,585 | | |
| 2,993,183 | |
| Sales and marketing | |
| 60,000 | | |
| 607,496 | |
| Total Operating Expenses | |
| 10,901,931 | | |
| 10,110,069 | |
| | |
| | | |
| | |
| Loss from Operations | |
| (2,503,843 | ) | |
| (2,041,766 | ) |
| | |
| | | |
| | |
| Other Income (Expense): | |
| | | |
| | |
| Interest expense | |
| (85,673 | ) | |
| (2,644 | ) |
| Total Other (Expense) | |
| (85,673 | ) | |
| (2,644 | ) |
| | |
| | | |
| | |
| Loss before Income Taxes | |
| (2,589,516 | ) | |
| (2,044,410 | ) |
| | |
| | | |
| | |
| Income Taxes | |
| — | | |
| — | |
| | |
| | | |
| | |
| Net Loss | |
$ | (2,589,516 | ) | |
$ | (2,044,410 | ) |
| | |
| | | |
| | |
| Loss per Share: | |
| | | |
| | |
| Basic and diluted | |
$ | (1,294.76 | ) | |
$ | (1,022.21 | ) |
| | |
| | | |
| | |
| Weighted Average Shares Outstanding: | |
| | | |
| | |
| Basic and diluted | |
| 2,000 | | |
| 2,000 | |
The accompanying notes are
an integral part of these unaudited carve-out consolidated financial statements.
DLQ INC.
Carve-out Consolidated Statements of Stockholder’s Equity (unaudited)
| | |
Common Stock | | |
Additional
Paid-in | | |
Accumulated | | |
Total
Stockholder’s | |
| For the Six Months Ended June 30, 2023 | |
Shares | | |
Amount | | |
Capital | | |
Deficit | | |
Equity | |
| Balance, December 31, 2022 | |
| 2,000 | | |
$ | — | | |
$ | 20,347,165 | | |
$ | (14,041,235 | ) | |
$ | 6,305,930 | |
| Share-based compensation | |
| — | | |
| — | | |
| 665,750 | | |
| — | | |
| 665,750 | |
| Net Loss | |
| — | | |
| — | | |
| — | | |
| (2,589,516 | ) | |
| (2,589,516 | ) |
| Balance, June 30, 2023 | |
| 2,000 | | |
$ | — | | |
$ | 21,012,915 | | |
$ | (16,630,751 | ) | |
$ | 4,372,164 | |
| | |
Common Stock | | |
Additional
Paid-in | | |
Accumulated | | |
Total
Stockholder’s | |
| For the Six Months Ended June 30, 2022 | |
Shares | | |
Amount | | |
Capital | | |
Deficit | | |
Equity | |
| Balance, December 31, 2021 | |
| 2,000 | | |
$ | — | | |
$ | 17,909,570 | | |
$ | (8,475,917 | ) | |
$ | 9,433,653 | |
| Acquisition of Battle Bridge | |
| — | | |
| — | | |
| 2,679,612 | | |
| — | | |
| 2,679,612 | |
| Share-based compensation | |
| — | | |
| — | | |
| (29,933 | ) | |
| — | | |
| (29,933 | ) |
| Net Loss | |
| — | | |
| — | | |
| — | | |
| (2,044,410 | ) | |
| (2,044,410 | ) |
| Balance, June 30, 2022 | |
| 2,000 | | |
$ | — | | |
$ | 20,559,249 | | |
$ | (10,520,328 | ) | |
$ | 10,038,921 | |
The accompanying notes are
an integral part of these unaudited carve-out consolidated financial statements.
DLQ INC.
Carve-out Consolidated Statements of Cash Flows (unaudited)
| | |
For the Six Months Ended
June 30, | |
| | |
2023 | | |
2022 | |
| CASH FLOW FROM OPERATING ACTIVITIES: | |
| | | |
| | |
| Net loss | |
$ | (2,589,516 | ) | |
$ | (2,044,410 | ) |
| Adjustments to reconcile net loss to net cash used in operating activities: | |
| | | |
| | |
| Depreciation expense | |
| 22,010 | | |
| 23,282 | |
| Amortization expense | |
| 755,437 | | |
| 608,956 | |
| Share-based compensation | |
| 665,750 | | |
| (29,933 | ) |
| Non-cash operating lease expense | |
| 58,122 | | |
| 102,338 | |
| | |
| | | |
| | |
| Changes in operating assets and liabilities: | |
| | | |
| | |
| Accounts receivable, net | |
| 338,459 | | |
| 1,686,903 | |
| Other current assets | |
| — | | |
| (11,867 | ) |
| Accounts payable | |
| (702,027 | ) | |
| (471,541 | ) |
| Accrued expenses | |
| 412,703 | | |
| (173,378 | ) |
| Lease liability – operating lease | |
| (16,589 | ) | |
| (102,338 | ) |
| Net cash used in operating activities | |
| (1,055,651 | ) | |
| (411,988 | ) |
| | |
| | | |
| | |
| INVESTING ACTIVITIES: | |
| | | |
| | |
| Cash paid for the acquisition of Battle Bridge | |
| — | | |
| (50,000 | ) |
| Net cash used in investing activities | |
| — | | |
| (50,000 | ) |
| | |
| | | |
| | |
| FINANCING ACTIVITIES: | |
| | | |
| | |
| Funding from related party | |
| 803,243 | | |
| 861,783 | |
| Proceeds from factor | |
| 314,821 | | |
| — | |
| Funding to related party | |
| (4,209 | ) | |
| (1,195,219 | ) |
| Net cash provided by (used in) financing activities | |
| 1,113,855 | | |
| (333,436 | ) |
| INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | |
| 58,204 | | |
| (795,424 | ) |
| Cash and Cash Equivalents, Beginning of the Period | |
| 417,074 | | |
| 826,152 | |
| Cash and Cash Equivalents, End of the Period | |
$ | 475,278 | | |
$ | 30,728 | |
| | |
| | | |
| | |
| Supplemental disclosure of cash flow information: | |
| | | |
| | |
| Cash paid for interest | |
$ | 85,673 | | |
$ | 2,644 | |
| | |
| | | |
| | |
| Supplemental disclosure of non-cash flow investing and financing activities: | |
| | | |
| | |
| Issuance of stock related to acquisition of Battle Bridge | |
$ | — | | |
$ | 2,679,612 | |
| Deferred consideration related to acquisition of Battle Bridge | |
$ | — | | |
$ | 200,000 | |
The accompanying notes are
an integral part of these unaudited carve-out consolidated financial statements.
DLQ INC.
NOTES TO THE CARVE-OUT CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 — ORGANIZATION
AND BUSINESS DESCRIPTION
Corporate Information
and Business Overview
DLQ, Inc.
is a Nevada corporation (“DLQ”), originally incorporated in 2019 as Origin8, Inc. DLQ is a wholly owned subsidiary of Logiq,
Inc., a Delaware corporation (“Logiq, Inc”), whose common stock is quoted on the OTCQX Market under the ticker symbol, “LGIQ.”
DLQ has three wholly owned subsidiaries, (i) Tamble Inc., a Delaware corporation (“Tamble”), (ii) Push Interactive,
LLC, a Minnesota limited liability company (“Push”), and (iii) Battle Bridge Acquisition Co. LLC, a Nevada corporation
(“Battle Bridge”). DLQ is headquartered in Minneapolis, Minnesota, USA.
Tamble,
Inc. is not an operating business. Its sole purpose is to hire independent contractors for the Company’s marketing business.
On January 8,
2020, the Company completed the acquisition of substantially all of the assets of Push Holdings, Inc. and the assets were transferred
to Push Interactive, LLC. This acquired business operates a consumer data management platform powered by lead generation, online
marketing, and multichannel reengagement strategies through its owned and operated brands. The Company has developed a proprietary data
management platform and integrated with several third-party service providers to optimize the return on its marketing efforts. The
Company focuses on consumer engagement and enrichment to maximize its return on acquisition through repeat monetization of each consumer.
As part of the transaction, Logiq, Inc. issued 35,714,285 shares to Conversion Point Technologies, Inc. as consideration for
the acquisition of all the assets of Push Holdings, Inc. in the amount of $14,285,714.
On March 31,
2022, the Company completed the acquisition of certain customer contractual agreements of Battle Bridge Labs, LLC, including those of
Section 2383 LLC, a Tulsa, Oklahoma based digital brand marketing agency.
Battle
Bridge became the third wholly owned subsidiary of the Company. Battle Bridge is a full-service branding and digital marketing agency
serving both external clients and internal parts of the Company. Battle Bridge offers branding and identity development in additional
to digital strategy and media busing services, as well as all of the requisite ancillary and supporting services to enable the branding
and digital practices.
On September 9,
2022, the Company entered into a definitive merger agreement for a business combination whereby it will merge with Abri Merger Sub Inc.,
a wholly owned subsidiary of Abri SPAC I, Inc., a special purpose acquisition company (“SPAC”). Upon closing of the business
combination, the company is expected to remain NASDAQ-listed under the name of the Company.
The business
combination between Abri and the Company will be affected through the merger of Abri Merger Sub, Inc. with and into the Company, with
the Company surviving the merger as a wholly owned subsidiary of Abri. Upon the closing of the acquisition, the Company originally planned
to change its name to “DataLogiq, Inc.”; however, on July 20, 2023, Abri and the Company agreed to change the name of
the surviving corporation to “Collective Audience, Inc.” Abri will issue 11.4 million shares in exchange for all of the
outstanding shares of the Company. At $10 per Abri share, the valuation of the Company is $114 million. The Board of Directors of
Logiq, Inc. and Abri, have unanimously approved the transaction. Closing the transaction will require the approval of both Logiq, Inc.
and Abri stockholders. All cash remaining in Abri’s trust account immediately after the closing of the business combination will
be available to the surviving entity for working capital, growth and other general corporate purposes. The transaction is expected to
close in the fourth quarter of 2023.
The accompanying
unaudited carve-out consolidated financial statements represent the financial position and result of operations of the Company as
a carve-out of Logiq, Inc.
NOTE 2 — SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION AND
PRINCIPLES OF CONSOLIDATION
The carve-out consolidated
financial statements have been prepared on an accrual basis of accounting of the Company in accordance with the accounting principles
generally accepted in the United States of America (“US GAAP”) and include the operations of the Company. The accompanying
unaudited interim carve out consolidated financial
DLQ INC.
NOTES TO THE CARVE-OUT CONSOLIDATED FINANCIAL STATEMENTS
NOTE 2 — SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
statements have been prepared
based upon U.S. Securities and Exchange Commission rules that permit reduced disclosure for interim periods. Therefore, they do not
include all information and footnote disclosures necessary for a complete presentation of the Company’s financial position, results
of operations and cash flows, in conformity with generally accepted accounting principles. All intercompany transactions have been eliminated
in consolidation.
USE OF ESTIMATES
The preparation
of the Company’s carve-out consolidated financial statements in conformity with US GAAP requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the
date of the carve-out consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.
Management makes its best estimate of the ultimate outcome for these items based on historical trends and other information available
when the carve-out consolidated financial statements are prepared. Actual results could differ from those estimates.
BUSINESS COMBINATIONS
The Company
allocates the purchase price of the acquisition to the tangible assets, liabilities and identifiable intangible assets acquired based
on their estimated fair values. The excess of the purchase price over those fair values is recorded as goodwill. Acquisition related expenses
and integration costs are expensed as incurred.
SEGMENT REPORTING
Operating
segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation
by the chief operating decision maker and the Chief Executive Officer, in making decisions regarding resource allocation and assessing
performance. The Company views its operations and manages its business as one operating segment in the United States.
FAIR VALUE OF FINANCIAL INSTRUMENTS
The assets
are valued using a fair market basis as defined in the Financial Accounting Standards Board (FASB ASC 820, Fair Value Measurement).
Fair value is the price the Company would receive to sell an asset or pay to transfer a liability in an orderly transaction with a market
participant at the measurement date. The Company uses a three-level hierarchy established by the Financial Accounting Standards Board
(FASB) that prioritizes fair value measurements based on the types of inputs used for the various valuation techniques (market approach,
income approach and cost approach). The levels of the fair value hierarchy are described below:
| |
|
Level 1: |
|
Quoted prices in active markets for identical assets or liabilities.
|
| |
|
Level 2: |
|
Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly; these include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active.
|
| |
|
Level 3: |
|
Unobservable inputs with little or no market data available, which require the reporting entity to develop its own assumptions. |
The Company’s
assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors
specific to the asset or liability. Financial assets and liabilities are classified in their entirety based on the most conservative level
of input that is significant to the fair value measurement. The fair value of certain assets and liabilities assumed in the acquisition
of Push Holdings, Inc. were determined utilizing the level 3 inputs.
LIQUIDITY
The Company
requires substantial amounts of operating cash for operating activities, including salaries and wages paid to the employees and contractors,
general and administrative expenses, and others. As of June 30, 2023, the Company had $475,278 in cash and cash equivalents.
DLQ INC.
NOTES TO THE CARVE-OUT CONSOLIDATED FINANCIAL STATEMENTS
NOTE 2 — SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
The Company
incurred operating losses and negative operating cash flows for the six months ended June 30, 2023, of $2,503,843 and $1,055,651
respectively. These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year after
the date that the carve-out consolidated financial statement was available to be issued.
The Company
considers operating results, capital resources and financial position, in combination with current projections and estimates, as part
of its plan to fund operations over a reasonable period of time. The future viability of the Company beyond June 30, 2023, is largely
dependent on funding from Logiq, Inc. or additional sources of financing.
Management
of DLQ will explore strategic alliances with enterprise investors that have a specific investment focus on digital marketing, advertising
technology and lead generation companies. DLQ is already acquainted with investment groups that have portfolio companies which could form
strategic investment/partnerships with DLQ. DLQ will explore these opportunities after the Business Combination.
While
it is anticipated that one of the above will provide assistance to address the liquidity concerns, these carve-out consolidated financial
statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification
of liabilities that might result from this uncertainty.
There
can be no assurance that the Company will be able to raise additional funds or that the terms and conditions of any future financing will
be workable or acceptable to the Company or its shareholders. If the Company is unable to fund its operations from existing cash on hand,
operating cash flows, additional borrowings, or raising equity capital, the Company may not continue operations.
RISKS AND UNCERTAINTIES
The Company
relies on cloud-based hosting through a global accredited hosting provider. Management believes that alternate sources are available;
however, disruption or termination of this relationship could adversely affect our operating results in the near-term.
GOODWILL
Goodwill
is recorded as the difference between the aggregate consideration in a business combination and the fair value of the acquired net tangible
and intangible assets. The Company evaluates goodwill for impairment on an annual basis in the fourth quarter or more frequently if indicators
of impairment exist that would more likely than not reduce the fair value of a reporting unit below its carrying amount. The Company first
assesses qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its
carrying value. Based on that qualitative assessment, if it is more likely than not that the fair value of a reporting unit is less than
its carrying value, the Company conducts a quantitative goodwill impairment test, which involves comparing the estimated fair value of
the reporting unit with its carrying value, including goodwill. The Company estimates the fair value of a reporting unit using a combination
of the income and market approach. If the carrying value of the reporting unit exceeds its estimated fair value, an impairment loss is
recorded for the difference. As of June 30, 2023 and December 31, 2022, the Company had recorded no impairment charges.
INTANGIBLE ASSETS
The Company’s
intangible assets consist of a trademark name and software technology that was acquired as part of the acquisition of Push Holdings, Inc.
as well as the customer contractual agreements as part of the Battle Bridge acquisition. The trademark name is amortized using the straight-line method
over 15 years. The software is amortized using the straight-line method over 7 years. The customer contractual agreements
are amortized using the straight-line method over 5 years.
IMPAIRMENT OF LONG-LIVED ASSETS
The Company
classifies its long-life assets into: (i) computer and office equipment; (ii) furniture and fixtures, (iii) leasehold
improvements, and (iv) finite life intangible assets.
DLQ INC.
NOTES TO THE CARVE-OUT CONSOLIDATED FINANCIAL STATEMENTS
NOTE 2 — SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
The Company
evaluates the recoverability of long-lived assets annually, or more frequently whenever events or changes in circumstances indicate
the assets might be impaired. If the carrying value of the long-life asset is not recoverable on a future cash flow basis, an impairment
is recognized. As of June 30, 2023 and December 31, 2022, the Company had recorded no impairment charges.
LEASES
The Company
leases its offices which are classified as operating leases in accordance with Topic 842. Under Topic 842, lessees are required
to recognize the following for all leases (with the exception of short-term leases) on the commencement date: (i) lease liability,
which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis; and (ii) right-of-use asset,
which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term.
At the
commencement date, the Company recognizes the lease liability at the present value of the lease payments not yet paid, discounted using
the interest rate implicit in the lease or, if that rate cannot be readily determined, the Company’s incremental borrowing rate
for the same term as the underlying lease. The right-of-use asset is recognized at the present value of future lease payments. There
were no impairments recorded for the periods ended June 30, 2023 and December 31, 2022. (Refer to NOTE 10 — COMMITMENTS
AND CONTINGENCIES)
ACCOUNTS RECEIVABLE
Accounts
receivable consists of trade receivables from customers. The Company records accounts receivable at its net realizable value, recognizing
an allowance for doubtful accounts based on our best estimate of probable credit losses on our existing accounts receivable. The Company
individually reviews all balances on an annual basis that exceed 90 days from the invoice date and assess for provisions for doubtful
accounts based on an assessment of the balance that will be collected. Balances are written off against the allowance after all means
of collection have been exhausted and the possibility of recovery is considered remote.
The allowance
for doubtful accounts as of June 30, 2023 and December 31, 2022 is $602,751. Bad debt expense for the six months ended
June 30, 2023 and 2022 was $42,564 and $0, respectively. The bad debt expense was booked as a recourse liability to account for the
chargebacks incurred with the factored receivables.
CASH AND CASH EQUIVALENTS
Cash and
cash equivalents represent cash on hand, demand deposits, and other short-term highly liquid investments placed with banks, which
have original maturities of three months or less and are readily convertible to known amounts of cash.
ACCOUNTS RECEIVABLE AND DUE
TO FACTOR
The Company
factors designated trade receivables pursuant to a factoring agreement with Bayview Funding LLC, an unrelated factor (the “Factor”).
The agreement specifies that eligible trade receivables are factored with recourse. The Company submits selected trade receivables to
the factor and receives up to 85% of the face value of the receivable by wire transfer or ACH. The Factor withholds 15% as retainage.
Upon payment by the customer, the Company receives the remainder of the amount due from the Factor, less fees.
Trade
receivables assigned to the Factor are carried at the original invoice amount less an estimate made for doubtful accounts. Under the terms
of the recourse provision, the Company is required to reimburse the Factor for factored receivables that are not paid on time. Accordingly,
these receivables are accounted for as a secured financing arrangement and not as a sale of financial assets.
The Company
presents the receivables, net of allowances, as current assets and presents the amount potentially due to the Factor as a secured financing
in the non-current liabilities. Of the total accounts receivable at June 30, 2023 and December 31, 2022, the total amount
of receivables factored with recourse was $288,615 and $270,599, respectively.
DLQ INC.
NOTES TO THE CARVE-OUT CONSOLIDATED FINANCIAL STATEMENTS
NOTE 2 — SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
CONCENTRATIONS OF RISK
The Company’s
financial instruments are potentially subject to concentrations of credit risk. The Company places its cash with high quality credit institutions.
From time to time, the Company maintains cash balances at certain institutions in excess of the FDIC limit. Management believes that the
risk of loss is not significant and has not experienced any losses in such accounts.
During
the six months ended June 30, 2023 and 2022, one customer represented approximately 80% and two customers represented approximately
43% of revenues, respectively.
As of
June 30, 2023, there was one customer that represented 28% of accounts receivable. As of December 31, 2022, there was one customer
that represented 10% of accounts receivable.
As of
June 30, 2023, two vendors accounted for approximately 23% of the accounts payable, and as of December 31, 2022, there were
no significant vendors.
REVENUE RECOGNITION
The Company
generates revenue derived from managed service contracts in accordance with Accounting Standards Update 2014-09, Revenue from Contracts
with Customers (Topic ASC 606) (Refer to NOTE 5 — REVENUE RECOGNITION).
INCOME TAXES
The Company
uses the asset and liability method of accounting for income taxes in accordance with Accounting Standards Codification 740, “Income
Taxes” (ASC 740). Under this method, income tax expense is recognized as the amount of: (i) taxes payable or refundable
for the current year and (ii) future tax consequences attributable to differences between carve-out consolidated financial statements
carrying amounts of existing assets and liabilities 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 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 the results of operations in the
period that includes the enactment date. A valuation allowance is provided to reduce the deferred tax assets reported if based on the
weight of available evidence it is more likely than not that some portion or all of the deferred tax assets will not be realized. Management
has determined that it is more likely than not that the Company will not realize its net deferred tax asset, and accordingly, a valuation
allowance has been deemed necessary.
The Company
is subject to income tax filings requirements in U.S. federal and various state jurisdictions. The Company’s tax returns for years
from 2019, 2020, and 2021 are subject to U.S. federal, state, and local income tax examinations by tax authorities.
The Company
reports income tax related interest and penalties within our income tax line item on our carve-out consolidated statements of operations.
We likewise report the reversal of income tax-related interest and penalties within such line item to the extent we resolve our liabilities
for uncertain tax positions in a manner favorable to our accruals.
SHARE-BASED COMPENSATION
Compensation
expense related to employee awards is measured and recognized in the carve-out consolidated financial statements based on the fair
value of the awards granted. The Company awarded restricted stock to employees at the fair value of the underlying stock on the grant
date. The Company also awarded restricted stock units (“RSU”) that are recognized over the required service term on a straight-line basis,
based on the fair value of the underlying stock of the grant date. Forfeitures are recorded as they occur. (Refer to NOTE 8 — STOCKHOLDER’S
EQUITY)
RECENT ACCOUNTING PRONOUNCEMENTS
Management
does not believe that any recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material
effect on the Company’s carve-out consolidated financial statement.
DLQ INC.
NOTES TO THE CARVE-OUT CONSOLIDATED FINANCIAL STATEMENTS
NOTE 3 — ACQUISITION
On March 31,
2022, the Company completed the acquisition of certain customer contractual agreements of Battle Bridge Labs, LLC, including those of
Section 2383 LLC, a Tulsa, Oklahoma-based digital brand marketing agency. Under ASC 805, Business Combinations, the assets
acquired do not meet the definition of a business. As such, the Company has accounted for the transaction as an asset acquisition. The
purchase price for the acquired assets was $2,929,612 and consisted of the issuance of 2,912,621 shares of restricted common stock
of Logiq, Inc. with a fair value of $2,679,612 and cash consideration of $250,000.
NOTE 4 — INTANGIBLE
ASSETS, NET
Intangibles,
net, consists of the following:
| Intangible Assets | |
June 30,
2023 | | |
December 31,
2022 | |
| | |
(unaudited) | | |
| |
| Trademarks/Names | |
$ | 1,060,000 | | |
$ | 1,060,000 | |
| Software | |
| 5,980,000 | | |
| 5,980,000 | |
| Customer list | |
| 2,929,612 | | |
| 2,929,612 | |
| Less accumulated amortization | |
| (3,969,737 | ) | |
| (3,214,300 | ) |
| Intangibles, net | |
$ | 5,999,875 | | |
$ | 6,755,312 | |
The estimated
future amortization of intangible assets as of June 30, 2023, is as follows:
| Remainder of 2023 | |
$ | 755,439 | |
| 2024 | |
| 1,510,875 | |
| 2025 | |
| 1,510,875 | |
| 2026 | |
| 1,510,875 | |
| 2027 | |
| 217,147 | |
| Thereafter | |
| 494,664 | |
| | |
$ | 5,999,875 | |
The amortization
expense totalled $755,437 and $608,956 for the six months ended June 30, 2023 and 2022, respectively, which is included in the
accompanying carve-out consolidated statements of operations.
NOTE 5 — REVENUE
RECOGNITION
ASC 606, Revenue
from Contracts with Customers
Under
ASC 606, revenue is recognized when a customer obtains control of promised goods or services in an amount that reflects the consideration
the Company expects to receive in exchange for those goods or services. The Company measures revenue based on the consideration specified
in the customer arrangement, and revenue is recognized when the performance obligations in the customer arrangement are satisfied. A performance
obligation is a promise in a contract to transfer a distinct service or product to the customer. The transaction price of a contract is
allocated to each distinct performance obligation and recognized as revenue when or as the customer receives the benefit of the performance
obligation.
DLQ INC.
NOTES TO THE CARVE-OUT CONSOLIDATED FINANCIAL STATEMENTS
NOTE 5 — REVENUE
RECOGNITION (cont.)
In determining
the appropriate amount of revenue to be recognized as it fulfils its obligations under its agreements, the Company performs the following
steps (i) identification of contracts with customers; (ii) identification of performance obligations; (iii) determination
of the transaction price; (iv) allocation of the transaction price to performance obligations; and (v) recognition of revenue
when or as the Company satisfies each performance obligation.
Typical
payment terms are between net 30 and net 60 days.
The Company
negotiates managed service agreements with the customers to specify the terms and conditions (including rights and obligations) and services
to be provided. The services provided are based on three primary streams of revenue: lead generation, affiliate management and reengagement.
Lead Generation Revenue
For its
Lead Generation revenue, the Company provides leads by purchasing ads to direct consumers to specific pages which are auctioned to the
customer base. The Company’s performance obligation is to deliver the leads to customers in accordance with the terms of the agreement.
The Company has concluded that this constitutes a single performance obligation for financial reporting purposes and that such obligation
is recognized at a point of time, for which the Company is transferring value to the customer through delivery.
Affiliate Management Revenue
For its
Affiliate Management revenue, the Company places ads on behalf of its customers after identifying the appropriate platforms to place the
ads, determining the most advantageous amount of ad spend per platform, determining the prices for each ad, and producing the marketing
materials. The Company has concluded that this constitutes a single performance obligation for financial reporting purposes and that such
obligation is recognized at a point of time, for which the Company is transferring value to the customer through delivery.
Reengagement Revenue
For its
Reengagement revenue, the Company provides links and advertisements via online, email, and In-App that generate views which are paid
for by the customer. The Company’s performance obligation is to deliver the activity of clicks on advertisements in accordance with
the terms of the agreement. The Company has concluded that this constitutes a single performance obligation for financial reporting purposes
and that such obligation is recognized at a point of time, for which the Company is transferring value to the customer through delivery.
Both streams
of revenue above are recorded on a gross basis. The Company is responsible for fulfilling the delivery of services, establishing the selling
price for the delivery, and the Company performs billing and collections, including ultimately retaining credit risk. The Company therefore
determined that is serves as a principal and that gross presentation of revenue is appropriate.
Revenue
consists of the following as of June 30:
| | |
Point in Time | |
| | |
2023 | | |
2022 | |
| | |
(unaudited) | | |
(unaudited) | |
| Lead Generation | |
$ | 1,442,787 | | |
$ | 6,746,797 | |
| Affiliate Management | |
| 6,731,379 | | |
| — | |
| Reengagement | |
| 223,922 | | |
| 1,321,506 | |
| Revenue | |
$ | 8,398,088 | | |
$ | 8,068,303 | |
DLQ INC.
NOTES TO THE CARVE-OUT CONSOLIDATED FINANCIAL STATEMENTS
NOTE 6 — PROPERTY
AND EQUIPMENT, NET
Property
and equipment, net, consists of the following:
| | |
June 30,
2023 | | |
December 31,
2022 | |
| | |
(unaudited) | | |
| |
| Computer and equipment | |
$ | 59,169 | | |
$ | 59,169 | |
| Leasehold improvements | |
| 165,957 | | |
| 165,957 | |
| | |
| 225,126 | | |
| 225,126 | |
| Less accumulated depreciation | |
| (161,706 | ) | |
| (139,696 | ) |
| Property and equipment, net | |
$ | 63,420 | | |
$ | 85,430 | |
Depreciation
expense for the three months ended June 30, 2023 and 2022 amounted to $22,010 and $23,282, respectively.
NOTE 7 — ACCRUED
EXPENSES
Accrued
expenses consist of the following:
| | |
June 30,
2023 | | |
December 31,
2022 | |
| | |
(unaudited) | | |
| |
| Credit cards | |
$ | 434,500 | | |
$ | 604,661 | |
| Payroll | |
| 1,462,526 | | |
| 892,755 | |
| Other | |
| 24,050 | | |
| 10,957 | |
| Accrued expenses | |
$ | 1,921,076 | | |
$ | 1,508,373 | |
NOTE 8 — STOCKHOLDER’S
EQUITY
Logiq,
Inc., the parent of the Company, authorized a 2020 Equity Incentive Plan, which provides the issuance of common stock and restricted stock
units (“RSU”) to be granted to eligible employees and consultants of Logiq, Inc, including those employed by DLQ, Inc.
Logiq,
Inc. issued shares of common stock to certain employees and consultants of the Company for services rendered (the “Compensation
Awards”). The Compensation awards were issued at the grant date fair value derived from OTCQX, the top tier of the three marketplaces
for the OTC trading of stocks, under the symbol “LGIQ”. On August 28, 2020, a total of 16,000 shares were granted
at $7.68 per unit. On July 16, 2021, a total of 130,000 shares were granted at $2.38 per unit. On September 2, 2021, a
total of 483,814 shares were granted at $3.97 per unit. On April 28, 2022, a total of 100,000 shares were granted at $0.534
per unit. On July 8, 2022, a total of 250,000 shares were granted at $0.365 per unit. In the periods ended June 30, 2023
and 2022, there were no shares of common stock issued. For the period ended June 30, 2023, the Company recorded an expense of $665,750
for share-based compensation related to common stock issued in November 2022 as compensation for an Independent Contractor Agreement
(refer to NOTE 12 — RELATED PARTIES). This expense included the recognition of the costs related to the contingent consideration
of an additional 1,750,000 restricted shares of Logiq, Inc. common stock as the Abri SPAC I, Inc., merger did not complete by April 1,
2023.
For the
period ended June 30, 2022, there was no expense recorded for the issuance of common stock. As of June 30, 2023, there was approximately
$629,250 of shared-based compensation remaining to be expensed related to the Independent Contractor Agreement.
RSU’s
vest ratably every six months over three years. In the event the participant ceases to be a service provider for any reason
before participant’s RSUs vest, the RSUs and participant’s right to acquire any shares will immediately terminate. To the
extent actual forfeiture occurs, the amount will be recorded as adjustment to compensation expense in the period in which it occurred.
On November 20, 2020, the Company granted 500,000 of RSUs to employees at $7.50 per unit. On July 16, 2021, one employee’s
RSUs were forfeited in exchange of 130,000 shares of common stock. On January 7, 2022, two employee’s RSUs were terminated,
and 200,000 non-vested shares were forfeited. On July 8, 2022, one employee’s RSUs were forfeited in exchange of 250,000 shares
of common stock. All RSU’s have been forfeited as of December 31, 2022, and no shared-based compensation expense is remaining
for future periods. Going forward the Company will no longer issue RSU’s under the 2020 Equity Incentive Plan.
DLQ INC.
NOTES TO THE CARVE-OUT CONSOLIDATED FINANCIAL STATEMENTS
NOTE 8 — STOCKHOLDER’S
EQUITY (cont.)
For the
period ended June 30, 2023, the Company recorded no expense for share-based compensation related to the RSUs. For the six months
ended June 30, 2022, a net recovery of share-based compensation related to the RSUs of $83,333 due to the forfeitures, offset
by ongoing expense for non-forfeited RSUs, was recorded in general and administrative expenses on the carve-out consolidated
financials.
NOTE 9 — LOSS
PER SHARE
Basic
loss per share is computed by dividing net loss applicable to Common Stockholders (the numerator) by the weighted average number of Common
Stock shares outstanding for the period (the denominator). The computation of net loss per share as of June 30 is as follows:
| | |
For the Six Months Ended
June 30, | |
| | |
2023 | | |
2022 | |
| | |
(unaudited) | | |
(unaudited) | |
| Net Loss | |
$ | (2,589,516 | ) | |
$ | (2,044,410 | ) |
| Weighted-average common shares outstanding – Basic and Diluted | |
| 2,000 | | |
| 2,000 | |
| Loss per share – Basic and Diluted | |
$ | (1,294.76 | ) | |
$ | (1,022.21 | ) |
NOTE 10 — COMMITMENTS
AND CONTINGENCIES
Operating lease
In 2020,
through the Push acquisition, the Company was assigned an operating lease for approximately 30,348 square feet of office and warehouse
space located in Minneapolis, Minnesota, at a rate of $367,200 per annum. The terms of the lease acquired were to expire on December 31,
2021. On September 1, 2021, the operating lease was amended to reduce the square footage leased to 26,954 at a rate of $26,300 per
month. On November 1, 2021, the operating lease was amended to further reduce the square footage leased to 12,422 at a rate of $17,500
per month to expire on December 31, 2022; however, the lease was extended from January 1, 2023 through April 30, 2023 at
a rate of $4,150 per month.
Under
the amended contract, there was no operating lease right-of-use asset and liability at June 30, 2023 and an operating lease
right-of-use asset and liability of $58,122 and $16,589 at December 31, 2022, respectively, utilizing an effective present value
rate at 3.25%.
For the
six months ended June 30, 2023 and 2022, the Company recorded approximately $58,122 and $102,338 in amortization expense, respectively.
The Company’s net rental expense was approximately $76,188 and $105,000 for the six-months ended June 30, 2023 and 2022,
respectively. As of June 30, 2023, the lease has expired and there is no additional commitment.
NOTE 11 — LEGAL
From time
to time, the Company is subject to various legal proceedings and claims, either asserted or unasserted, that arise in the ordinary course
of business. Although the outcome of the various legal proceedings and claims cannot be predicted with certainty, management does not
believe that any of these proceedings or other claims will have a material effect on the Company’s business, financial condition,
results of operations or cash flows.
NOTE 12 — RELATED
PARTIES
In both
2023 and 2022, the Company made advances to two related parties and obtained funding from Logiq, Inc. to support the operations of the
business. The related party receivables are due from entities under common control of Logiq, Inc. and as of June 30, 2023 and December 31,
2022, amounts to approximately $3,784,000 and $3,780,000, respectively. The related party payable is due to Logiq, Inc. and as of June 30,
2023 and December 31, 2022, amounts to approximately $8,666,000 and $7,863,000, respectively.
DLQ INC.
NOTES TO THE CARVE-OUT CONSOLIDATED FINANCIAL STATEMENTS
NOTE 12 — RELATED
PARTIES (cont.)
On November 8,
2022, the Company entered into a Managed Services Agreement (the “MSA”) with a significant new client (the “Client”)
and will provide certain affiliate management, website development, lead generation, email management, and search engine optimization
services (collectively, the “Services”) to Client through the Company’s platform. The MSA will terminate on October 31,
2023, provided that the term may be extended beyond such date by mutual written agreement of the parties. Notwithstanding the foregoing,
Client may terminate the MSA at any time after January 1, 2023, without cost or any penalty, in the event that it is dissatisfied
with the Services provided thereunder.
In connection
with the MSA, on November 8, 2022, the Company and Client also entered into an Independent Contractor Agreement (the “IC Agreement,”
and together with the MSA, the “Agreements”), pursuant to which Client will provide, on a non-exclusive basis, certain
business development strategies and execution and consulting services regarding e-commerce, digital marketing, and online advertising,
including lead generation, affiliate marketing and brand development to the Company. The term of the IC Agreement coincides with the term
of the MSA.
As compensation
for the services to be provided by Client to the Company under the IC Agreement, the Company agreed to issue Client 1,750,000 restricted
shares of Logiq, Inc. common stock (the “Initial Shares”) upon execution of the Agreements. In the event that the proposed
acquisition of a wholly owned subsidiary of the Company by Abri SPAC I, Inc., which proposed acquisition was previously disclosed
by the Company in that Current Report on Form 8-K filed with the Securities and Exchange Commission on September 12, 2022,
is not completed on or before April 1, 2023, then the Company shall issue Client an additional 1,750,000 restricted shares of Logiq,
Inc. common stock (such additional shares together with the Initial Shares, the “Registrable Shares”) as further contingent
consideration pursuant to the Agreements.
The Initial
Shares had a fair value of $805,000 and the Company is recognizing the expense over the term of the agreement. In March, the Company deemed
it probable that the acquisition would not be completed on or before April 1, 2023 upon receipt of the SEC comment letter dated February 28,
2023. In accordance with ASC 718, Compensation — Stock Compensation, the Company deemed the fair value of the shares on
February 29, 2023 to be $490,000 and is recognizing the expense over the remaining term of the agreement. Since the proposed acquisition
by Abri SPAC I, Inc. was not completed by April 1, 2023, the Company has issued Client an additional 1,750,000 restricted shares
of Logiq, Inc. common stock.
During
the six months ended June 30, 2023, the Company recognized $665,750 as compensation expense, which is included in general and administrative
expenses on the accompanying carve-out consolidated statement of operations.
NOTE 13 — SUBSEQUENT
EVENTS
The Company
has evaluated subsequent events occurring through the date these financial statements were issued, for their potential impact on the carve-out consolidated
financial statements and disclosures and there were no subsequent events to report except the following:
On July 20,
2023, Abri, Abri Sub, DLQ Parent, and DLQ entered into an amendment to the Merger Agreement to (i) remove provisions related to the transfer
of certain intellectual property assets of Fixel AI, Inc. and Rebel AI, Inc. (ii) change the name of the Surviving Corporation to “Collective
Audience, Inc.” and (iii) increase the size of the senior financing facility from $25 Million to $30 Million.
On September 5,
2023, DLQ entered into an agreement with certain institutional investors (the “Investors”) for a $5 million investment
in DLQ (the “DLQ Investment”) in the form of convertible promissory notes issued by DLQ (the “DLQ Notes”). The
DLQ Notes shall convert into such number of shares of common stock of DLQ (the “Conversion Shares”), that would be exchanged
for 1,600,000 Merger Consideration Shares at the Closing. As a condition to the DLQ Investment, the Investors requested an assurance mechanism
from DLQ to protect the Investors in the event they were unable to recoup the full value of the DLQ Investment. DLQ agreed to put into
escrow 1,500,000 Merger Consideration Shares (the “Reset Shares”), which shares would be released to the Investors to cover
any shortfall of the DLQ Investment, up to the maximum amount of Reset Shares. After the Closing of the Business Combination, once the
Investors recoup the DLQ Investment, any remaining Reset Shares not released to the Investors, would be distributed to DLQ Parent Stockholders
as additional Dividend Shares. In addition, approximately 6 million Merger Consideration Shares, not distributed to DLQ Parent Stockholders,
shall be placed in an escrow account until the DLQ Investment has been recouped by the Investors, or all the Reset Shares have been released.
Annex A
EXECUTION VERSION
MERGER AGREEMENT
dated as of
September 9, 2022
by and among
Logiq, Inc. (a Delaware corporation),
DLQ, Inc. (a Nevada corporation),
ABRI SPAC I, Inc.,
and
ABRI Merger Sub, Inc.
| |
|
Annex A
Page No. |
| ARTICLE I DEFINITIONS |
|
A-2 |
| |
|
1.1 |
|
Definitions |
|
A-2 |
| |
|
1.2 |
|
Construction |
|
A-13 |
| |
|
|
| ARTICLE II MERGER |
|
A-14 |
| |
|
2.1 |
|
Merger |
|
A-14 |
| |
|
2.2 |
|
Merger Effective Time |
|
A-14 |
| |
|
2.3 |
|
Effect of the Merger |
|
A-14 |
| |
|
2.4 |
|
U.S. Tax Treatment |
|
A-15 |
| |
|
2.5 |
|
Articles of Incorporation; Bylaws |
|
A-15 |
| |
|
2.6 |
|
Closing |
|
A-15 |
| |
|
2.7 |
|
Directors and Officers of Surviving Corporation |
|
A-15 |
| |
|
2.8 |
|
Directors and Officers of Parent |
|
A-15 |
| |
|
2.9 |
|
Taking of Necessary Action; Further Action |
|
A-16 |
| |
|
2.10 |
|
No Further Ownership Rights in Company Capital Stock |
|
A-16 |
| |
|
|
|
|
|
|
| ARTICLE III EFFECT OF THE MERGER AND RELATED MATTERS |
|
A-16 |
| |
|
3.1 |
|
Effect of the Merger on Company Common Stock |
|
A-16 |
| |
|
3.2 |
|
Surrender and Payment |
|
A-16 |
| |
|
3.3 |
|
Distribution Matters |
|
A-16 |
| |
|
3.4 |
|
|
|
|
| |
|
3.5 |
|
Consideration Spreadsheet |
|
A-17 |
| |
|
3.6 |
|
Earnout |
|
A-17 |
| |
|
3.7 |
|
Adjustment |
|
A-18 |
| |
|
3.8 |
|
No Fractional Shares |
|
A-18 |
| |
|
3.9 |
|
Withholding |
|
A-18 |
| |
|
|
|
|
|
|
| ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND DLQ PARENT |
|
A-18 |
| |
|
4.1 |
|
Corporate Existence and Power |
|
A-18 |
| |
|
4.2 |
|
Authorization |
|
A-19 |
| |
|
4.3 |
|
Governmental Authorization |
|
A-20 |
| |
|
4.4 |
|
Non-Contravention |
|
A-20 |
| |
|
4.5 |
|
Capitalization |
|
A-20 |
| |
|
4.6 |
|
Corporate Records |
|
A-21 |
| |
|
4.7 |
|
Subsidiaries |
|
A-21 |
| |
|
4.8 |
|
Consents |
|
A-22 |
| |
|
4.9 |
|
Financial Statements |
|
A-22 |
| |
|
4.10 |
|
Books and Records |
|
A-22 |
| |
|
4.11 |
|
Internal Accounting Controls |
|
A-22 |
| |
|
4.12 |
|
Absence of Certain Changes |
|
A-22 |
| |
|
4.13 |
|
Properties; Title to the Company’s Assets |
|
A-22 |
| |
|
4.14 |
|
Litigation |
|
A-23 |
| |
|
4.15 |
|
Contracts |
|
A-23 |
| |
|
4.16 |
|
Licenses and Permits |
|
A-24 |
| |
|
4.17 |
|
Compliance with Laws |
|
A-25 |
| |
|
4.18 |
|
Intellectual Property |
|
A-25 |
| |
|
4.19 |
|
Accounts Payable; Affiliate Loans |
|
A-29 |
| |
|
4.20 |
|
Employees; Employment Matters |
|
A-29 |
| |
|
4.21 |
|
Withholding |
|
A-31 |
| |
|
4.22 |
|
Employee Benefits |
|
A-31 |
| |
|
4.23 |
|
Real Property |
|
A-32 |
| |
|
Annex A
Page No. |
| |
|
4.24 |
|
Tax Matters |
|
A-32 |
| |
|
4.25 |
|
Environmental Laws |
|
A-33 |
| |
|
4.26 |
|
Finders’ Fees |
|
A-34 |
| |
|
4.27 |
|
Powers of Attorney, Suretyships and Bank Accounts |
|
A-34 |
| |
|
4.28 |
|
Directors and Officers |
|
A-34 |
| |
|
4.29 |
|
Anti-Money Laundering Laws |
|
A-34 |
| |
|
4.30 |
|
Insurance |
|
A-35 |
| |
|
4.31 |
|
Related Party Transactions |
|
A-35 |
| |
|
4.32 |
|
No Trading or Short Position |
|
A-35 |
| |
|
4.33 |
|
Not an Investment Company |
|
A-35 |
| |
|
4.34 |
|
Information Supplied |
|
A-35 |
| |
|
|
|
|
|
|
| ARTICLE V REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB |
|
A-36 |
| |
|
5.1 |
|
Corporate Existence and Power |
|
A-36 |
| |
|
5.2 |
|
Corporate Authorization |
|
A-36 |
| |
|
5.3 |
|
Governmental Authorization |
|
A-36 |
| |
|
5.4 |
|
Non-Contravention |
|
A-37 |
| |
|
5.5 |
|
Finders’ Fees |
|
A-37 |
| |
|
5.6 |
|
Issuance of Shares |
|
A-37 |
| |
|
5.7 |
|
Capitalization |
|
A-37 |
| |
|
5.8 |
|
Information Supplied |
|
A-38 |
| |
|
5.9 |
|
Trust Fund |
|
A-38 |
| |
|
5.10 |
|
Listing |
|
A-38 |
| |
|
5.11 |
|
Board Approval |
|
A-38 |
| |
|
5.12 |
|
Parent SEC Documents and Financial Statements |
|
A-39 |
| |
|
5.13 |
|
Certain Business Practices |
|
A-40 |
| |
|
5.14 |
|
Anti-Money Laundering Laws |
|
A-40 |
| |
|
5.15 |
|
Affiliate Transactions |
|
A-40 |
| |
|
5.16 |
|
Litigation; Permits |
|
A-40 |
| |
|
5.17 |
|
Compliance with Laws |
|
A-40 |
| |
|
5.18 |
|
Absence of Certain Changes |
|
A-41 |
| |
|
5.19 |
|
Indebtedness |
|
A-41 |
| |
|
5.20 |
|
Not an Investment Company |
|
A-41 |
| |
|
5.21 |
|
Employment Matters |
|
A-41 |
| |
|
5.22 |
|
Tax Matters |
|
A-41 |
| |
|
5.23 |
|
HSR Act |
|
A-42 |
| |
|
5.24 |
|
Opportunity to Conduct Due Diligence |
|
A-42 |
| |
|
|
|
|
|
|
| ARTICLE VI COVENANTS OF THE PARTIES PENDING CLOSING |
|
A-42 |
| |
|
6.1 |
|
Conduct of the Business |
|
A-42 |
| |
|
6.2 |
|
Exclusivity |
|
A-45 |
| |
|
6.3 |
|
Access to Information |
|
A-45 |
| |
|
6.4 |
|
Notices of Certain Events |
|
A-46 |
| |
|
6.5 |
|
Access to Information |
|
A-46 |
| |
|
6.6 |
|
Cooperation with Form S-4/Proxy Statement; Other Filings |
|
A-46 |
| |
|
6.7 |
|
Trust Account |
|
A-49 |
| |
|
6.8 |
|
Obligations of Merger Sub |
|
A-49 |
| |
|
6.9 |
|
Proprietary Information and Invention Assignment Agreement |
|
A-49 |
| |
|
Annex A
Page No. |
| ARTICLE VII COVENANTS OF THE PARTIES |
|
A-49 |
| |
|
7.1 |
|
Reporting; Compliance with Laws; No Insider Trading |
|
A-49 |
| |
|
7.2 |
|
Commercially Reasonable Efforts to Obtain Consents |
|
A-50 |
| |
|
7.3 |
|
DLQ Parent Stockholder Approval |
|
A-50 |
| |
|
7.4 |
|
Additional Financial Information |
|
A-50 |
| |
|
7.5 |
|
Lock-Up Agreements |
|
A-50 |
| |
|
7.6 |
|
Amended Parent Charter |
|
A-50 |
| |
|
7.7 |
|
Preservation of Intellectual Property; No New Related Company Customer Contracts |
|
A-50 |
| |
|
7.8 |
|
No Dividends or Extraordinary Bonuses Until 11 Months After Closing |
|
A-51 |
| |
|
7.9 |
|
Employment Agreements |
|
A-51 |
| |
|
7.10 |
|
Senior Financing Facility |
|
A-51 |
| |
|
7.11 |
|
Record Retention |
|
A-51 |
| |
|
|
|
|
|
|
| ARTICLE VIII COVENANTS OF ALL PARTIES HERETO |
|
A-51 |
| |
|
8.1 |
|
Commercially Reasonable Efforts; Further Assurances; Governmental Consents |
|
A-51 |
| |
|
8.2 |
|
Compliance with SPAC Agreements |
|
A-52 |
| |
|
8.3 |
|
Confidentiality |
|
A-52 |
| |
|
8.4 |
|
Directors’ and Officers’ Indemnification and Liability Insurance |
|
A-52 |
| |
|
8.5 |
|
Parent Public Filings; NASDAQ |
|
A-53 |
| |
|
8.6 |
|
Certain Tax Matters |
|
A-53 |
| |
|
8.7 |
|
Parent Equity Incentive Plan |
|
A-54 |
| |
|
|
|
|
|
|
| ARTICLE IX CONDITIONS TO CLOSING |
|
A-54 |
| |
|
9.1 |
|
Condition to the Obligations of the Parties |
|
A-54 |
| |
|
9.2 |
|
Conditions to Obligations of Parent and Merger Sub |
|
A-54 |
| |
|
9.3 |
|
Conditions to Obligations of the Company |
|
A-56 |
| |
|
|
|
|
|
|
| ARTICLE X TERMINATION |
|
A-57 |
| |
|
10.1 |
|
Termination Without Default |
|
A-57 |
| |
|
10.2 |
|
Termination Upon Default |
|
A-57 |
| |
|
10.3 |
|
Effect of Termination |
|
A-58 |
| |
|
|
|
|
|
|
| ARTICLE XI NON-SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS; CONSEQUENCES OF BREACH |
|
A-58 |
| |
|
11.1 |
|
Non-Survival |
|
A-58 |
| |
|
11.2 |
|
No Remedy |
|
A-58 |
| |
|
|
|
|
|
|
| ARTICLE XII MISCELLANEOUS |
|
A-59 |
| |
|
12.1 |
|
Notices |
|
A-59 |
| |
|
12.2 |
|
Amendments; No Waivers; Remedies |
|
A-60 |
| |
|
12.3 |
|
Arm’s Length Bargaining; No Presumption Against Drafter |
|
A-60 |
| |
|
12.4 |
|
Publicity |
|
A-60 |
| |
|
12.5 |
|
Expenses |
|
A-60 |
| |
|
12.6 |
|
No Assignment or Delegation |
|
A-60 |
| |
|
12.7 |
|
Governing Law |
|
A-60 |
| |
|
12.8 |
|
Counterparts; Facsimile Signatures |
|
A-60 |
| |
|
12.9 |
|
Entire Agreement |
|
A-61 |
| |
|
12.10 |
|
Severability |
|
A-61 |
| |
|
12.11 |
|
Further Assurances |
|
A-61 |
| |
|
12.12 |
|
Third Party Beneficiaries |
|
A-61 |
| |
|
Annex A
Page No. |
| |
|
12.13 |
|
Waiver |
|
A-61 |
| |
|
12.14 |
|
No Other Representations; No Reliance |
|
A-61 |
| |
|
12.15 |
|
Waiver of Jury Trial |
|
A-63 |
| |
|
12.16 |
|
Submission to Jurisdiction |
|
A-63 |
| |
|
12.17 |
|
Arbitration |
|
A-64 |
| |
|
12.18 |
|
Remedies |
|
A-64 |
| |
|
12.19 |
|
Non-Recourse |
|
A-64 |
| |
|
12.20 |
|
Attorney-Client Privilege |
|
A-65 |
| Exhibit A — |
|
Form of Parent Support Agreement |
|
A-67 |
| Exhibit B — |
|
Management Earnout Agreement |
|
A-74 |
| Exhibit C — |
|
Sponsor Earnout Agreement |
|
A-81 |
| Exhibit D — |
|
Form of Revenue Sharing Side Letter |
|
A-88 |
| Exhibit E — |
|
Form of Lock Up Agreement |
|
A-90 |
| Exhibit F — |
|
Form of Registration Rights Agreement |
|
A-95 |
| Exhibit G — |
|
Form of Amended Parent Charter |
|
A-113 |
| Exhibit H — |
|
Form of Amended and Restated Bylaws |
|
A-120 |
| Exhibit I — |
|
Form of Voting Agreement |
|
A-137 |
MERGER AGREEMENT
MERGER
AGREEMENT dated as of September 9, 2022 (this “Agreement”), by and among Logiq, Inc., a Delaware corporation (the “DLQ
Parent”), DLQ, Inc., a Nevada corporation (the “Company”), Abri SPAC I, Inc., a Delaware corporation (“Parent”),
and Abri Merger Sub, Inc., a Delaware corporation (“Merger Sub”).
WITNESSETH:
A. DLQ
Parent is a Delaware corporation whose common stock is quoted on the OTCQX Market under the ticker symbol, “LGIQ”, and that
has three wholly-owned subsidiaries (i) the Company, (ii) Fixel AI, Inc. (“Fixel AI”) and (iii) Rebel AI, Inc. (“Rebel”);
B. Fixel
has one wholly-owned subsidiary, Fixel Israel Ltd. (“Fixel Israel”) and Company has three (3) wholly-owned subsidiaries: (i)
Tamble, Inc. (“Tamble”), (ii) Push Interactive LLC (“Push”) and (iii) BattleBridge Acquisition Co.,
LLC (“BattleBridge”);
C. Collectively,
DLQ Parent, Fixel, Fixel Israel, Rebel, Company, Tamble, Push and BattleBridge constitute the “Company Group,” and
Rebel, Fixel, and Fixel Israel constitute the “Sister Companies.”
D. The
Company Group is in the business of digital marketing analytics that offers proprietary data management, audience targeting and other
digital marketing services that improve small-to-medium-sized businesses’ discovery and branding within the e-commerce landscape
and related activities (as currently conducted by the Company Group, the “Business”);
E. Parent
is a blank check company formed for the sole purpose of entering into a share exchange, asset acquisition, share purchase, recapitalization,
reorganization or other similar business combination with one or more businesses or entities, and Merger Sub is a wholly-owned subsidiary
of Parent;
F. Merger
Sub will merge with and into the Company (the “Merger”), after which the Company will be the surviving company in the
Merger (the “Surviving Corporation”) and a wholly-owned subsidiary of Parent and Parent shall change its name to “DataLogiq,
Inc.”;
G. Prior
to the Merger and as a condition to the Closing of the transactions contemplated by this Agreement, (i) all of the Intellectual Property
of DLQ Parent and the Sister Companies will be contributed to the Company pursuant to one or more Intellectual Property assignment agreements
acceptable to Parent, (ii) certain IP Contracts and customer Contracts involving DLQ Parent and any of the Sister Companies shall be cancelled,
terminated or allowed to expire, and (iii) DLQ Parent shall change its name to a new name that neither includes nor is confusingly similar
to “Logiq,” “DataLogiq” or any of the Trademarks owned by Company or contributed to Company pursuant to subclause
(i) of this recital;
H. Contemporaneously
with the execution of, and as a condition and an inducement to Parent and the Company entering into this Agreement, Sponsor is entering
into and delivering a Support Agreement, substantially in the form attached hereto as Exhibit A (the “Parent
Support Agreement”), pursuant to which Sponsor has agreed (i) not to transfer or redeem any shares of Parent Common Stock held
by such Parent stockholder, and (ii) to vote in favor of the adoption and approval of each of the Parent Proposals at the Parent Stockholder
Meeting,
I. At
the Closing, the Company and Parent are entering into and delivering a Management Earnout Agreement, substantially in the form attached
hereto as Exhibit B (the “Management Earnout Agreement”), pursuant to which certain additional shares
of Parent Common Stock will be issued to certain management of the Company upon the terms set forth in the Management Earnout Agreement;
J. At
the Closing, the Sponsor, Parent and certain other stockholders of Parent are entering into and delivering a Sponsor Earnout Agreement,
substantially in the form attached hereto as Exhibit C (the “Sponsor Earnout Agreement”), pursuant
to which certain additional shares of Parent Common Stock will be issued to the Sponsor upon the terms set forth in the Sponsor Earnout
Agreement;
K. Contemporaneously
with the execution of, and as a condition and an inducement to Parent and the Company entering into this Agreement, the Sponsor and the
Parent are entering into and delivering a Warrant Revenue Sharing Side Letter substantially in the form attached hereto as Exhibit
D (the “Revenue Sharing Side Letter”), pursuant to which in the event of a cash exercise of any Parent Warrants
(the “Warrant Exercise”) as set forth in the final prospectus of Parent, dated August 9, 2021 (the “Prospectus”),
the Company shall pay 20% of the gross proceeds of the Warrant Exercise to the Sponsor not later than three (3) business days from the
closing of the Warrant Exercise;
L. Contemporaneously
with the Closing of the transactions contemplated by this Agreement, DLQ Parent will issue a dividend to the DLQ Parent Stockholders on
the Record Date on a pro rata basis of an amount equal to approximately Twenty Five Percent (25%) of the aggregate Merger Consideration
Shares (the “Dividend Shares”) it receives from Parent (the “Distribution”), with the remaining
Merger Consideration Shares held by DLQ Parent subject to a lock-up in accordance with the terms and conditions more fully set forth in
the Lock-Up Agreement;
M. For
U.S. federal income tax purposes, the parties hereto intend that the Merger will qualify as a reorganization within the meaning of Section
368(a) of the Code and the Company’s Board of Directors and the Boards of Directors of Parent and Merger Sub have approved this
Agreement and intend that it constitute a plan of reorganization within the meaning of Treasury Regulation Section 1.368-2(g); and
N. The
Boards of Directors of each of the Company, DLQ Parent, Parent and Merger Sub have unanimously (i) approved and declared advisable this
Agreement and the transactions contemplated by this Agreement and the Additional Agreements to which they are or will be party, including
the Merger, and the performance of their respective obligations hereunder or thereunder, on the terms and subject to the conditions set
forth herein or therein, (ii) determined that this Agreement and such transactions are advisable and in the best interests of, them and
their respective stockholders and (iii) resolved to recommend that their stockholders approve the Merger and such other transactions and
adopt this Agreement and the Additional Agreements to which they are or will be a party and the performance of such party of its obligations
hereunder and thereunder.
In consideration
of the mutual covenants and promises set forth in this Agreement, and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereby agree as follows:
ARTICLE I
DEFINITIONS
1.1 Definitions.
“AAA”
has the meaning set forth in Section 12.17.
“AAA
Procedures” has the meaning set forth in Section 12.17.
“Action”
means any legal action, litigation, suit, claim, hearing, proceeding or investigation, including any audit, claim or assessment for Taxes
or otherwise, by or before any Authority.
“Additional
Agreements” means the Registration Rights Agreement, the Parent Support Agreements, the Management Earnout Agreement, the Sponsor
Earnout Agreement, the Revenue Sharing Side Letter, the Lock-Up Agreements and the Voting Agreement.
“Additional
Parent SEC Documents” has the meaning set forth in Section 5.12(a).
“Affiliate”
means, with respect to any Person, any other Person directly or indirectly Controlling, Controlled by or under common Control with such
Person.
“Agreement”
has the meaning set forth in the preamble.
“Alternative
Proposal” has the meaning set forth in Section 6.2(b).
“Alternative
Transaction” has the meaning set forth in Section 6.2(a).
“Amended
Parent Charter” has the meaning set forth in Section 6.5(e).
“Anti-Corruption
Laws” has the meaning set forth in Section 4.29(a).
“Applicable
Taxes” mean such Taxes as defined in IRS Notice 2020-65 (and any corresponding Taxes under state or local tax Applicable Law).
“Applicable
Wages” mean such wages as defined in IRS Notice 2020-65 (and any corresponding wages under state or local tax Applicable Law).
“Authority”
means any federal, state, local or foreign government or political subdivision thereof, or any agency or instrumentality of such government
or political subdivision, or any self-regulated organization or other non-governmental regulatory authority or quasi-governmental authority
exercising executive, legislative, judicial, regulatory or administrative functions (to the extent that the rules, regulations or orders
of such organization or authority have the force of Law), or any arbitrator, court or tribunal of competent jurisdiction.
“Balance
Sheet” means the audited consolidated balance sheet of the Company as of December 31, 2021.
“Balance
Sheet Date” has the meaning set forth in Section 4.9(a).
“Books
and Records” means all books and records, ledgers, employee records, customer lists, files, correspondence, and other records
of every kind (whether written, electronic, or otherwise embodied) owned or controlled by a Person in which a Person’s assets, the
business or its transactions are otherwise reflected, other than stock books and minute books.
“Business”
has the meaning set forth in the recitals to this Agreement.
“Business
Combination” has the meaning set forth in Section 5.11(a).
“Business
Day” means any day other than a Saturday, Sunday or a legal holiday on which commercial banking institutions in New York, New
York are authorized to close for business, excluding as a result of “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 commercially banking institutions in New
York, New York are generally open for use by customers on such day.
“Certificates
of Merger” has the meaning set forth in Section 2.2.
“Closing”
has the meaning set forth in Section 2.6.
“Closing
Date” has the meaning set forth in Section 2.6.
“COBRA”
means collectively, the requirements of Sections 601 through 606 of ERISA and Section 4980B of the Code.
“Code”
means the Internal Revenue Code of 1986, as amended.
“Company”
has the meaning set forth in the Preamble.
“Company
Acquisition Agreement” has the meaning set forth in Section 6.2(a).
“Company
Certificate of Incorporation” means the Articles of Incorporation of the Company, filed with the Secretary of State of the State
of Nevada on December 16, 2019, as amended.
“Company
Common Stock” means the shares of the Company’s common stock, par value $0.001 per share.
“Company
Customer Contract” means any Contract in which Company or one of its Subsidiaries (or any of their predecessor entities) is
a party and under which Company or one of its Subsidiaries provides one or more Company Group Products.
“Company
Group Consent” has the meaning set forth in Section 4.8.
“Company
Group Exclusively Licensed IP” means all Company Group Licensed IP that is exclusively licensed to or purported to be exclusively
licensed to any member of the Company Group.
“Company
Group” has the meaning set forth in the recitals to this Agreement.
“Company
Group Financial Statements” means (a) the audited consolidated balance sheets of the Company, and the related statements of
operations, changes in stockholders’ equity and cash flows, for the fiscal years ended December 31, 2021 and December 31, 2020 including
the notes thereto, each prepared under U.S. GAAP and audited by a PCAOB qualified auditor in accordance with requirements of the PCAOB
for public companies, and (b) the draft unaudited consolidated balance sheet of the Company as of June 30, 2022 (including a comparative
balance sheet as of June 30, 2021 in accordance with GAAP) and the related statements of operations, changes in stockholders’ equity
and cash flows for the six month period ended June 30, 2022 (including comparative financial statements for the six month period ending
June 30, 2021 in accordance with GAAP).
“Company
Group Information Systems” has the meaning set forth in Section 4.18(n).
“Company
Group IP” means, collectively, all Company Group Owned IP and Company Group Licensed IP.
“Company
Group Licensed IP” means all Intellectual Property owned by a third Person and licensed to or purported to be licensed to any
member of the Company Group or that any member of the Company Group otherwise has a right to use or purports to have a right to use.
“Company
Group Owned IP” means all Intellectual Property owned or purported to be owned by any member of the Company Group.
“Company
Group Products” means any and all Software products (including SAAS products) and digital marketing services offered by any
member of the Company Group (or any predecessor entity).
“Company
IP Contracts” has the meaning set forth in the definition of “IP Contracts.”
“Company
Stockholders” means, at any given time, the holders of Company Common Stock.
“Company
Stockholder Approval” has the meaning set forth in Section 4.2(b).
“Confidential
Information” means any information, knowledge or data concerning the businesses or affairs of the Company Group, or any suppliers,
customers or agents of the Company Group, including any such information, knowledge or data that constitutes Company Group Owned IP, in
each case that is not already generally available to the public.
“Confidentiality
Agreement” means the Confidentiality Agreement dated as of July 31, 2022 by and between DLQ Parent and Abri Advisors Ltd., an
Affiliate of Parent.
“Consideration
Spreadsheet” has the meaning set forth in Section 3.4(a).
“Contracts”
means the Lease and all other legally binding contracts, agreements, leases (including equipment leases, car leases and capital leases),
commitments, client contracts, statements of work (SOWs), sales and purchase orders and similar instruments, oral or written, to which
any member of the Company Group is a party or by which any of its respective properties or assets is legally bound.
“Control”
of a Person means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies
of such Person, whether through the ownership of voting securities, by contract, or otherwise. “Controlled”, “Controlling”
and “under common Control with” have correlative meanings.
“Conversion
Ratio” means an amount equal to (a) the Per Share Merger Consideration Amount, divided by (b) $10.00.
“Copyleft
Licenses” means all licenses or other Contracts to Software that requires as a condition of use, modification, or distribution
of such Software that such Software or derivative works thereof incorporated into, derived from, or distributed with such Software (i)
be disclosed or distributed in source code form, (ii) be licensed for the purpose of making derivative works, (iii) be redistributable
at no or minimal charge, or (iv) be reverse engineered. Copyleft licenses include without limitation the GNU General Public License, the
GNU Lesser General Public License, the Mozilla Public License, the Common Development and Distribution License, the Eclipse Public License,
and all Creative Commons “sharealike” licenses.
“Copyrights”
has the meaning set forth in the definition of “Intellectual Property.”
“Data
Protection Laws” means all applicable Laws and codes in any applicable jurisdiction relating to the Processing, privacy, security,
or protection of Personal Information; data and information security; trans-border data flow; or data protection; and all regulations
issued thereunder.
“Delaware
Certificate of Merger” has the meaning set forth in Section 2.2.
“DGCL”
has the meaning set forth in Section 2.1.
“Dispute”
has the meaning set forth in Section 11.17.
“Distribution”
has the meaning set forth in the recitals.
“Distribution
Date” means the date that the Distribution shall become effective.
“Distribution
Time” means the time established by DLQ Parent as the effective time of the Distribution on the Distribution Date.
“Dividend
Shares” has the meaning set forth in the recitals.
“DLQ
Parent Common Stock” means the shares of DLQ Parent’s common stock, par value $0.0001 per shares.
“DLQ
Parent SEC Documents” means: to the extent available in full without redaction on the SEC’s website through EDGAR for
at least two (2) Business Days prior to the date of this Agreement (i) DLQ Parent’s Annual Reports on Form 10-K for each fiscal
year of DLQ Parent beginning with the first year that DLQ Parent was required to file such a form, (ii) DLQ Parent’s Quarterly Reports
on Form 10-Q for each fiscal quarter of DLQ Parent beginning with the first quarter DLQ was required to file such a form, (iii) all proxy
statements relating to DLQ Parent’s meetings of stockholders (whether annual or special) held, and all information statements relating
to stockholder consents, since the beginning of the first fiscal year referred to in clause (i) above, (iv) DLQ Parent’s Form 8-Ks
filed since the beginning of the first fiscal year referred to in clause (i) above, and (v) all other forms, reports, registration statements
and other documents filed by DLQ Parent with the SEC since Parent’s formation.
“DLQ
Parent Stockholders” means, at any given time, the holders of DLQ Parent Common Stock.
“DLQ
Parent Stockholder Approval” has the meaning set forth in Section 4.2(c).
“Effective
Time” has the meaning set forth in Section 2.2.
“Enforceability
Exceptions” has the meaning set forth in Section 4.2(a).
“Environmental
Laws” shall mean all applicable Laws that prohibit, regulate or control any Hazardous Material or any Hazardous Material Activity,
including the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, the Resource Recovery and Conservation Act
of 1976, the Federal Water Pollution Control Act, the Clean Air Act, the Hazardous Materials Transportation Act and the Clean Water Act.
“ERISA”
means the Employee Retirement Income Security Act of 1974, as amended.
“ERISA
Affiliate” means each entity, trade or business that is, or was at the relevant time, a member of a group described in Section
414(b), (c), (m) or (o) of the Code or Section 4001(b)(1) of ERISA that includes or included the Company Group, or that is, or was at
the relevant time, a member of the same “controlled group” as the Company Group pursuant to Section 4001(a)(14) of ERISA.
“Exchange
Act” means the Securities Exchange Act of 1934, as amended.
“Excluded
Matter” means any one or more of the following: (a) general economic or political conditions; (b) conditions generally affecting
the industries in which such Person or its Subsidiaries operates; (c) any changes in financial, banking or securities markets in general,
including any disruption thereof and any decline in the price of any security or any market index or any change in prevailing interest
rates; (d) acts of war (whether or not declared), armed hostilities or terrorism, or the escalation or worsening thereof; (e) any action
required or permitted by this Agreement or any action or omission taken by the Company or its Subsidiaries with the written consent or
at the request of Parent or any action or omission taken by Parent or Merger Sub with the written consent or at the request of the Company;
(f) (i) any changes in applicable Laws (including in connection with the COVID-19 pandemic) or accounting rules (including U.S. GAAP)
or the enforcement, implementation or interpretation thereof, or (ii) in the case of DLQ Parent or Parent, new pronouncements by the SEC
or other U.S. federal regulators with respect to prior accounting rules, including changes to, and the restatement of Parent’s audited
financial statements as of and for the fiscal year ended December 31, 2021 or for future periods, as a result of the SEC pronouncement
on April 12, 2021 relating to the accounting of warrants (the “SEC Warrant Pronouncement”); (g) any adverse effect
to the extent attributable to the transactions contemplated or permitted hereby including, without limitation, the announcement, pendency
or completion of the transactions contemplated by this Agreement; (h) any natural or man-made disaster, acts of God or epidemics, pandemics,
including the COVID-19 pandemic, or other public health event or the worsening thereof; or (i) any failure by a party to meet any internal
or published projections, forecasts or revenue or earnings predictions (it being understood that the facts or occurrences giving rise
or contributing to such failure that are not otherwise excluded from the definition of a “Material Adverse Effect” may be
taken into account in determining whether there has been a Material Adverse Effect); provided, however, that the
exclusions provided in the foregoing clauses (a) through (d), clause (f) and clause (h) shall not apply to the extent that Parent and
Merger Sub, taken as a whole, on the one hand, or the Company Group, taken as a whole, on the other hand, is disproportionately affected
by any such exclusions or any change, event or development to the extent resulting from any such exclusions relative to all other similarly
situated companies that participate in the industry in which they operate.
“Export
Control Laws” has the meaning set forth in Section 4.29(a).
“Foreign
Corrupt Practices Act” has the meaning set forth in Section 4.29(a).
“Form
S-4” has the meaning set forth in Section 6.5(a).
“Fully
Diluted Company Shares” means the sum, without duplication, of (a) all shares of Company Common Stock that
are issued and outstanding immediately prior to the Effective Time; plus (b) all shares of Company Common Stock
issuable upon conversion, exercise or exchange of any other in-the-money securities of the Company convertible into or exchangeable or
exercisable for shares of Company Common Stock.
“Hazardous
Material” shall mean any material, emission, chemical, substance or waste that has been designated by any Authority to be radioactive,
toxic, hazardous, a pollutant or a contaminant.
“Hazardous
Material Activity” shall mean the transportation, transfer, recycling, storage, use, treatment, manufacture, removal, remediation,
release, exposure of others to, sale, labeling, or distribution of any Hazardous Material or any product or waste containing a Hazardous
Material, or product manufactured with ozone depleting substances, including any required labeling, payment of waste fees or charges (including
so-called e-waste fees) and compliance with any recycling, product take-back or product content requirements.
“HSR
Act” shall mean the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and any rules or regulations promulgated
thereunder.
“Indebtedness”
means with respect to any Person, (a) all obligations of such Person for borrowed money, including with respect thereto, all interests,
fees and costs, (b) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments, (c) all obligations of
such Person under conditional sale or other title retention agreements relating to property purchased by such Person, (d) all obligations
of such Person issued or assumed as the deferred purchase price of property or services (other than accounts payable to creditors for
goods and services incurred in the ordinary course of business consistent with past practices), (e) all Indebtedness of others secured
by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any lien or security
interest on property owned or acquired by such Person, whether or not the obligations secured thereby have been assumed, (f) all obligations
of such Person under capital leases, (g) all guarantees by such Person of the Indebtedness of another Person, (h) all liability of such
Person with respect to any hedging obligations, including interest rate or currency exchange swaps, collars, caps or similar hedging obligations,
(i) any obligations that the Company has elected to defer pursuant to the CARES Act or as a result of COVID-19, including any deferred
rent or deferred Taxes, and any liabilities associated with any loans or other stimulus packages received by the Company under the CARES
Act and applicable rules and regulations thereunder, and (j) any agreement to incur any of the same. For purposes of this definition,
“capital lease” means the obligations of the Company under a long-term lease that transfers to the lessee ownership of a capital
asset over time, and the amount of such obligations at any date shall be the capitalized amount of such obligations at such date determined
in accordance with U.S. GAAP together with all obligations to make termination payments under such capitalized lease obligations.
“Intellectual
Property” means all of the worldwide intellectual property rights and proprietary rights associated with any of the following,
whether registered, unregistered or registrable, to the extent recognized in a particular jurisdiction, and all tangible embodiments and
fixations of and documentation related to any of the following: discoveries, inventions, ideas, technology, know-how, works of authorship
Software, systems, methods, processes, procedures, practices, algorithms, formulae, techniques, knowledge, results, protocols, models,
designs, drawings, specifications, materials, technical data or information, information related to the development, marketing, pricing,
distribution, cost, sales and manufacturing, and proprietary or confidential information, in each case whether or not patentable or copyrightable
(collectively, “Technology”); information (including a formula, pattern, compilation, program, device, method, technique,
or process, or any information relating to Technology) that derives independent economic value, actual or potential, from not being generally
known to the public or to other persons who can obtain economic value from its disclosure or use and is the subject of efforts that are
reasonable under the circumstances to maintain its secrecy (collectively, “Trade Secrets”); trade names, trademarks,
service marks, trade dress, logos and other indication of origin, registrations thereof or applications for registration therefor, together
with the goodwill associated with the foregoing (collectively, “Trademarks”); patents, patent applications, utility
models, industrial designs, supplementary protection certificates, and certificates of inventions, including all re-issues, continuations,
divisionals, continuations-in-part, re-examinations, renewals, counterparts, extensions, and validations thereof (collectively, “Patents”);
works of authorship, copyrights, copyrightable materials, copyright registrations and applications for copyright registration (collectively,
“Copyrights”); domain names and URLs (collectively, “Domain Names”); social media handles and accounts;
other intellectual property; and all additions, improvements, or modifications to any of the foregoing, and all registrations and issuances
and applications therefor.
“Interim
Period” has the meaning set forth in Section 6.1(a).
“International
Trade Control Laws” has the meaning set forth in Section 4.29(a).
“IP
Contracts” means, collectively:
(a) any
and all of the following Contracts (“Company IP Contracts”):
(i) Contracts
in which Company or any of its Subsidiaries (or any of their predecessor entities) is granted or has granted an exclusive right (including
exclusive option rights and exclusive rights of first offer, first refusal, first negotiation, etc.) in or to any Intellectual Property;
(ii) Contracts
in which Company or any of its Subsidiaries (or any of their predecessor entities) is granted a non-exclusive right (including non-exclusive
option rights or non-exclusive rights of first offer, first refusal, first negotiation, etc.) in or to any Intellectual Property, excluding
Contracts for “off-the-shelf” Software licensed to Company or any of its Subsidiaries pursuant to standard commercial terms
for an aggregate license fee of less than $50,000 or having an annual subscription fee of less than $25,000, and further excluding Contracts
for Publicly Available Software;
(iii) Contracts
in which Company or any of its Subsidiaries (or any of their predecessor entities) has granted a non-exclusive right (including non-exclusive
option rights or non-exclusive rights of first offer, first refusal, first negotiation, etc.) in or to any Intellectual Property or a
covenant not to assert or sue with respect to any Intellectual Property, excluding any (A) Company Customer Contracts made by Company
or one of its Subsidiaries in the ordinary course of Business consistent with past practices, such Company Customer Contracts containing
a non-exclusive license to use Company Group Owned IP, provided that the non-exclusive license is limited to that Company Group IP that
is actually incorporated in or practiced by the Company Group Product and provided further that the Company Customer Contract contains
no other express or implied licenses to Intellectual Property; and (B) any implied non-exclusive licenses in, to, or under Company
Group Owned IP granted to a customer of Company or one of its Subsidiaries arising in connection with the provision of a Company Group
Product by Company or one of its Subsidiaries in the ordinary course of Business consistent with past practices; and
(v) settlement
agreements and co-existence arrangements involving Intellectual Property in which Company or any of its Subsidiaries (or any predecessor
entities) is a party;
and
(b) and
any all of the following Contracts (those Contracts under subparts (i) and (iii), the “Related Company Inbound IP Contracts”,
those Contracts under subparts (ii) and (iv), the “Related Company Outbound IP Contracts”, and those Contracts under
subpart (v) the “Related Company Settlement IP Contracts”):
(i) Contracts
in which DLQ Parent or any Sister Company (or any of their predecessor entities) is granted an exclusive right (including exclusive option
rights and exclusive rights of first offer, first refusal, first negotiation, etc.) in or to any Intellectual Property;
(ii) Contracts
in which DLQ Parent or any Sister Company (or any of their predecessor entities) has granted an exclusive right (including exclusive option
rights and exclusive rights of first offer, first refusal, first negotiation, etc.) in or to any Intellection Property;
(iii) Contracts
in which DLQ Parent or any of the Sister Companies (or any of their predecessor entities) is granted a non-exclusive right (including
non-exclusive option rights or non-exclusive rights of first offer, first refusal, first negotiation, etc.) in or to any Intellectual
Property or a covenant not to assert or sue with respect to any Intellectual Property, excluding Contracts for “off-the-shelf”
Software that is licensed to DLQ Parent or any of the Sister Companies pursuant to standard commercial terms and that is not used or necessary
to run or support Company Group Products (but including, for the avoidance of doubt, all other Contracts for “off-the-shelf”
Software that is licensed to DLQ Parent or any of the Sister Companies pursuant to standard commercial terms and that is used or necessary
to run or support Company Group Products), and further excluding Contracts for Publicly Available Software;
(iv) Contracts
in which DLQ Parent or any Sister Company (or any of their predecessor entities) has granted a non-exclusive right (including non-exclusive
option rights or non-exclusive rights of first offer, first refusal, first negotiation, etc.) in or to any Intellectual Property or a
covenant not to assert or sue with respect to any Intellectual Property;
(v) settlement
agreements and co-existence arrangements involving Intellectual Property in which DLQ Parent or any Sister Company (or any predecessor
entities) is a party.)
“IPO”
means the initial public offering of Parent pursuant to the Prospectus.
“Knowledge”
with respect to the Company Group and DLQ Parent means the actual knowledge after reasonable inquiry of Brent Suen, Manny Puentes, and
Chris Metcalf; it being understood and agreed that the obligation to conduct a “reasonable inquiry” will be deemed satisfied
if the above referenced persons inquire to obtain the information known by each of the following individuals with regards to those representations
qualified by Knowledge in Article IV: Robb Billy, Chris Andrews and Mitch Savage.
“Knowledge”
with respect to Parent means the actual knowledge after reasonable inquiry of Jeffrey Tirman, Chris Hardt, and Nima Montazeri.
“Law”
means any domestic or foreign, federal, state, municipality or local law, statute, ordinance, code, rule, or regulation.
“Lease”
means the lease described on Schedule 1.1(a) attached hereto, together with all fixtures and improvements erected on
the premises leased thereby.
“Lien”
means, with respect to any property or asset, any mortgage, license, lien, pledge, charge, claim, security interest or encumbrance of
any kind in respect of such property or asset, and any conditional sale or voting agreement or proxy, including any agreement to give
any of the foregoing.
“Lock-Up
Agreements” means the agreements, in substantially the form attached hereto as Exhibit E-1, restricting the sale,
transfer or other disposition of 8,550,000 shares of Parent Common Stock received by DLQ Parent at the Closing in connection with the
Merger, which agreement shall specifically exclude the Dividend Shares (other than with respect to certain members of management who shall
enter into a Lock-Up Agreement with respect to the Dividend Shares received by them).
“Material
Adverse Effect” means any fact, effect, event, development, change, state of facts, condition, circumstance, violation or occurrence
(an “Effect”) that, individually or together with one or more other contemporaneous Effect, (i) has or would reasonably
be expected to have a materially adverse effect on the financial condition, assets, liabilities, business or results of operations of
the Company Group, on the one hand, or on Parent and Merger Sub, on the other hand, taken as a whole; or (ii) prevents or materially impairs
or would reasonably be expected to prevent or materially impair the ability of the DLQ Parent and the Company Group, on the one hand,
or on Parent and Merger Sub, on the other hand to consummate the Merger and the other transactions contemplated by this Agreement in accordance
with the terms and conditions of this Agreement; provided, however, that a Material Adverse Effect shall not be
deemed to include Effects (and solely to the extent of such Effects) resulting from an Excluded Matter.
“Material
Contracts” has the meaning set forth in Section 4.15(a). “Material Contracts” shall not include any
Contracts that are also Plans.
“Merger”
has the meaning set forth in the recitals to this Agreement.
“Merger
Consideration Shares” means an aggregate number of shares of Parent Common Stock equal to the product of (i) the Conversion
Ratio, multiplied by (ii) Fully-Diluted Company Shares.
“Merger
Sub” has the meaning set forth in the Preamble.
“Merger
Sub Common Stock” has the meaning set forth in Section 5.7(b).
“Names”
has the meaning set forth in the definition of “Intellectual Property.”
“NASDAQ”
means the Nasdaq Stock Market LLC.
“Nevada
Articles of Merger” has the meaning set forth in Section 2.2.
“NRS”
has the meaning set forth in Section 2.1.
“Offer
Documents” has the meaning set forth in Section 6.5(a).
“Order”
means any decree, order, judgment, writ, award, injunction, stipulation, determination, award, rule or consent of or by an Authority.
“OSHA”
has the meaning set forth in Section 4.20(l).
“Other
Filings” means any filings to be made by Parent required under the Exchange Act, Securities Act or any other United States federal,
foreign or blue sky laws, other than the SEC Statement and the other Offer Documents.
“Outside
Closing Date” has the meaning set forth in Section 10.1(a).
“Parent”
has the meaning set forth in the Preamble.
“Parent
Board Recommendation” has the meaning set forth in Section 5.11(a).
“Parent
Common Stock” means, the common stock of Parent, par value $0.0001 per share.
“Parent
Parties” has the meaning set forth in the preamble to ARTICLE V.
“Parent
Preferred Stock” has the meaning set forth in Section 5.7(a).
“Parent
Private Warrants” means each warrant issued to the Sponsor in a private placement at the time of the consummation of the IPO,
entitling the holder thereof to purchase one share of Parent Common Stock at an exercise price of $11.50 per whole share.
“Parent
Proposals” has the meaning set forth in Section 6.5(e).
“Parent
Public Warrant” means each warrant issued as part of a Parent Unit.
“Parent
Redemption Amount” has the meaning set forth in Section 6.6.
“Parent
SEC Documents” has the meaning set forth in Section 5.12(a).
“Parent
Stockholder Approval” has the meaning set forth in Section 5.2.
“Parent
Stockholder Meeting” has the meaning set forth in Section 6.5(a).
“Parent
Unit” means each unit of Parent issued in the IPO comprised of (a) one share of Parent Common Stock, (b) one warrant to purchase
one share of Parent Common Stock at a price of $11.50 per share.
“Parent
Warrant” shall mean each Parent Private Warrant and Parent Public Warrant.
“Patents”
has the meaning set forth in the definition of “Intellectual Property.”
“PCAOB”
means the Public Company Accounting Oversight Board.
“Per
Share Merger Consideration Amount” means an amount equal to One Hundred Fourteen Million U.S. Dollars ($114,000,000) divided
by the number of Fully Diluted Company Shares.
“Permit”
has the meaning set forth in Section 4.16.
“Permitted
Liens” means (a) all defects, exceptions, restrictions, easements, rights of way and encumbrances (i) disclosed in policies
of title insurance which have been made available to Parent or (ii) that do not interfere with the use of such real property or materially
diminish the value thereof; (b) mechanics’, carriers’, workers’, repairers’ and similar statutory Liens arising
or incurred in the ordinary course of business consistent with past practices for amounts (i) that are not yet due or delinquent, (ii)
that are not material to the business, operations and financial condition of the Company so encumbered, either individually or in the
aggregate, and (iii) not resulting from a breach, default or violation by the Company Group of any Contract or Law; (c) liens for Taxes,
assessments, fees and other charges by Authorities not yet due and payable or which are being contested in good faith by appropriate proceedings
(and for which adequate accruals or reserves have been established on the Financial Statements in accordance with U.S. GAAP); (d) statutory
or common law liens to secure obligations to landlords, lessors or rents under leases or rental agreements, (e) pledges, deposits or other
Liens securing the performance of bids, trade contracts, leases or statutory obligations (including workers’ compensation, unemployment
insurance, other social security legislation or similar programs mandated by Laws), (f) the Liens set forth on Schedule 1.1(b),
(g) non-exclusive licenses of Company Owned IP granted in the ordinary course of Business consistent with past practices, solely pursuant
to a Company Customer Contract or Related Company Customer Contract containing no other express or implied licenses to Intellectual Property
and provided further that the non-exclusive license is limited to that Company Owned IP that is actually incorporated in or practiced
by the Company Group Product, and (h) any implied non-exclusive licenses in, to, or under Company Group IP granted to a customer of a
member of the Company Group arising in connection with the provision of a Company Group Product by such member of the Company Group in
the ordinary course of Business consistent with past practices.
“Person”
means an individual, corporation, partnership (including a general partnership, limited partnership or limited liability partnership),
limited liability company, association, trust or other entity or organization, including a government, domestic or foreign, or political
subdivision thereof, or an agency or instrumentality thereof.
“Personal
Information” has the meaning set forth in Section 4.18(l).
“Plan”
means each “employee benefit plan” within the meaning of Section 3(3) of ERISA and all other material compensation and benefits
plans, policies, programs, arrangements or payroll practices, including multiemployer plans within the meaning of Section 3(37) of ERISA,
and each other stock purchase, stock option, restricted stock, severance, retention, employment (other than any employment offer letter
in such form as previously provided to Parent that is terminable “at will” without any contractual obligation on the part
of the Company Group to make any severance, termination, change of control, or similar payment), consulting, change-of-control, bonus,
incentive, deferred compensation, employee loan and fringe benefit plan, agreement, program, policy, commitment or other arrangement,
whether or not subject to ERISA (including any related funding mechanism now in effect or required in the future), whether formal or informal,
oral or written, in each case, that is sponsored, maintained, contributed or required to be contributed to by the Company Group, or under
which the Company Group has any current or potential liability, but excluding any statutory plan, program or arrangement that is maintained
by an Authority.
“Privacy
Policy” has the meaning set forth in Section 4.18(k).
“Process,”
“Processed” or “Processing” means any operation or set of operations performed upon Personal Information
or sets of Personal Information, whether or not by automated means, such as collection, recording,
“Prohibited
Party” has the meaning set forth in Section 4.29(b).
“Prospectus”
has the meaning set forth in the recitals to this Agreement.
“Proxy
Statement” has the meaning set forth in Section 6.5(a).
“Public
Distributions” has the meaning set forth in Section 12.13.
“Publicly
Available Software” means each of any Software that contains, or is derived in any manner (in whole or in part) from, any Software
that is distributed as free software, “copyleft,” open source software (e.g. Linux), or under similar licensing
and distribution models, including but not limited to any of the following: (A) the GNU General Public License (GPL) or Lesser/Library
GPL (LGPL), (B) the Artistic License (e.g., PERL), (C) the Mozilla Public License, (D) the Netscape Public License, (E) the Sun Community
Source License (SCSL), (F) the Sun Industry Source License (SISL) and (G) the Apache Server License, including for the avoidance of doubt
all Software licensed under a Copyleft License.
“Real
Property” means, collectively, all real properties and interests therein (including the right to use), together with all buildings,
fixtures, trade fixtures, plant and other improvements located thereon or attached thereto; all rights arising out of use thereof (including
air, water, oil and mineral rights); and all subleases, franchises, licenses, permits, easements and rights-of-way which are appurtenant
thereto.
“Record
Date” means the close of business on the date to be determined by the Board of Directors of DLQ Parent as the record date for
determining stockholders of DLQ Parent entitled to participate in the Distribution, which date shall be the Business Day preceding the
Distribution Date.
“Registered
Exclusively Licensed IP” means all Intellectual Property, including Patents, Copyrights and Trademarks, constituting Company
Group Exclusively Licensed IP, in each instance that is the subject of a registration, issuance or an application therefor with an Authority.
“Registered
IP” means collectively, all Registered Owned IP and Registered Exclusively Licensed IP.
“Registered
Owned IP” means all Intellectual Property, including Patents, Copyrights, and Trademarks, constituting Company Group Owned IP,
in each instance that is the subject of a registration, issuance or an application therefor with an Authority.
“Registration
Rights Agreement” means the registration rights agreement, in substantially the form attached hereto as Exhibit F.
“Related
Company Customer Contract” means any Contract in which DLQ Parent or one of the Sister Companies (or any of their predecessor
entities) is a party and under which DLQ Parent or one of the Sister Companies provides one or more Company Group Products.
“Related
Company Inbound IP Contracts” has the meaning set forth in the definition of “IP Contracts.”
“Related
Company Outbound IP Contracts” has the meaning set forth in the definition of “IP Contracts.”
“Related
Company Settlement IP Contracts” has the meaning set forth in the definition of “IP Contracts.”
“Representatives”
means a party’s officers, directors, Affiliates, managers, consultant, employees, representatives and agents.
“Resolution
Period” has the meaning set forth in Section 12.17.
“Revenue
Sharing Side Letter” has the meaning set forth in the recitals to this Agreement
“S-4
Effective Date” has the meaning set forth in Section 6.5(c).
“Sanctions
Laws” has the meaning set forth in Section 4.29(a).
“Sarbanes-Oxley
Act” means the Sarbanes-Oxley Act of 2002, as amended.
“SEC”
means the Securities and Exchange Commission.
“SEC
Statement” means the Form S-4, including the Proxy Statement, whether in preliminary or definitive form, and any amendments
or supplements thereto.
“Securities
Act” means the Securities Act of 1933, as amended.
“Security
Breach” means any actual or reasonably suspected: (1) theft, unauthorized access or accidental access to, loss of, unauthorized
Processing of, and unauthorized disclosure, acquisition, use, modification, destruction, or deletion of Personal Information; (2) unauthorized
use of Personal Information by a person with authorized access to the information for purposes of actual or reasonably suspected theft,
fraud or identity theft; (3) unauthorized disclosure or alteration of Personal Information; or (4) loss of Personal Information, including
without limitation, any of the foregoing described in (1) – (3) caused by or resulting from a failure, lack of or inadequacy of
security, physical intrusion of facilities, theft or loss of documents, laptops or storage media, or employee or contractor malfeasance.
“Security Breach” shall not include unsuccessful attempts or activities that do not compromise the security of Personal Information,
including unsuccessful log-in attempts, pings, port scans, denial of service attacks, and other network attacks on firewalls or networked
systems.
“Sister
Companies” has the meaning set forth in the recitals to this Agreement.
“Sites”
has the meaning set forth in Section 4.18(k).
“Software”
means computer software, programs, and databases (including development tools, library functions, and compilers), including any such computer
software programs, and databases associated with software-as-a-service, platform-as-a-service, infrastructure-as-a-service, or other “as-a-service”
model, in any form, including in or as Internet Web sites, web content, links, source code, object code, operating systems, database management
code, utilities, graphical user interfaces, menus, images, icons, forms, methods of processing, software engines, platforms, and data
formats, together with all versions, updates, corrections, enhancements and modifications thereof, and all related specifications, documentation,
developer notes, comments, and annotations.
“Sponsor”
means Abri Ventures I, LLC, a Delaware limited liability company.
“Standard
Contracts” has the meaning set forth in the definition of IP Contracts.
“Subsidiary”
means, with respect to any Person, each entity of which at least fifty percent (50%) of the capital stock or other equity or voting securities
are Controlled or owned, directly or indirectly, by such Person.
“Surviving
Corporation” has the meaning set forth in the recitals to this Agreement.
“Tangible
Personal Property” means all tangible personal property and interests therein, including machinery, computers and accessories,
furniture, office equipment, communications equipment, automobiles, laboratory equipment and other equipment owned or leased by the Company
Group and other tangible property.
“Tax
Return” means any return, information return, declaration, claim for refund or credit, report or any similar statement, and
any amendment thereto, including any attached schedule and supporting information, whether on a separate, consolidated, combined, unitary
or other basis, that is filed or required to be filed with any Taxing Authority in connection with the determination, assessment, collection
or payment of a Tax or the administration of any Law relating to any Tax.
“Tax(es)”
means any U.S. federal, state or local or non-U.S. tax, charge, fee, levy, custom, duty, deficiency, or other assessment of any kind or
nature imposed by any Taxing Authority (including any income (net or gross), gross receipts, profits, windfall profit, sales, use, goods
and services, ad valorem, franchise, license, withholding, employment, social security, workers compensation, unemployment compensation,
employment, payroll, transfer, excise, import, real property, personal property, intangible property, occupancy, recording, minimum, alternative
minimum), together with any interest, penalty, additions to tax or additional amount imposed with respect thereto.
“Taxing
Authority” means the Internal Revenue Service and any other Authority responsible for the collection, assessment or imposition
of any Tax or the administration of any Law relating to any Tax.
“Technology”
has the meaning set forth in the definition of “Intellectual Property.”
“Trade
Secrets” has the meaning set forth in the definition of “Intellectual Property.”
“Trademarks”
has the meaning set forth in the definition of “Intellectual Property.”
“Transaction
Litigation” has the meaning set forth in Section 8.1(c).
“Trust
Account” has the meaning set forth in Section 5.9.
“Trust
Agreement” has the meaning set forth in Section 5.9.
“Trust
Fund” has the meaning set forth in Section 5.9.
“Trustee”
has the meaning set forth in Section 5.9.
“U.S.
GAAP” means U.S. generally accepted accounting principles, consistently applied.
“USPTO”
has the meaning set forth in Section 4.18(c).
“Voting
Agreement” means the Voting Agreement in substantially the form attached hereto as Exhibit I.
1.2 Construction.
(a)
References to particular sections and subsections, schedules, and exhibits not otherwise specified are cross-references to sections and
subsections, schedules, and exhibits of this Agreement. Captions are not a part of this Agreement, but are included for convenience, only.
(b)
The words “herein,” “hereof,” “hereunder,” and words of similar import refer to this Agreement as
a whole and not to any particular provision of this Agreement; and, unless the context requires otherwise, “party” means a
party signatory hereto.
(c)
Any use of the singular or plural, or the masculine, feminine or neuter gender, includes the others, unless the context otherwise requires;
the word “including” means “including without limitation”; the word “or” means “and/or”;
the word “any” means “any one, more than one, or all”; and, unless otherwise specified, any financial or accounting
term has the meaning of the term under United States generally accepted accounting principles as consistently applied heretofore by the
Company. Any reference in this Agreement to a Person’s directors shall include any member of such Person’s governing body
and any reference in this Agreement to a Person’s officers shall include any Person filling a substantially similar position for
such Person in the event that such Person is not a corporation. Any reference in this Agreement or any Additional Agreement to a Person’s
shareholders or stockholders shall include any applicable owners of the equity interests of such Person, in whatever form, in the event
such Person is not a corporation; provided, that, for the avoidance of doubt no reference to shareholders or stockholders shall include
anyone who is a holder of a derivative instrument or convertible security.
(d)
Unless otherwise specified, any reference to any agreement (including this Agreement), instrument, or other document includes all schedules,
exhibits, or other attachments referred to therein, and any reference to a statute or other law means such law as amended, restated, supplemented
or otherwise modified from time to time through the Closing Date and includes any rule, regulation, ordinance or the like promulgated
thereunder, in each case, as amended, restated, supplemented or otherwise modified from time to time through the Closing Date.
(e)
Any reference to a numbered schedule means the same-numbered section of the Disclosure Schedule. Any reference in a schedule contained
in the Disclosure Schedules delivered by a party hereunder shall be deemed to be an exception to (or, as applicable, a disclosure for
purposes of) the applicable representations and warranties (or applicable covenants) that are contained in the section or subsection of
this Agreement that corresponds to such schedule and any other representations and warranties of such party that are contained in this
Agreement to which the relevance of such item thereto is reasonably apparent on its face. The mere inclusion of an item in a schedule
as an exception to (or, as applicable, a disclosure for purposes of) a representation or warranty shall not be deemed an admission that
such item represents a material exception or material fact, event or circumstance or that such item would have a Material Adverse Effect
or establish any standard of materiality to define further the meaning of such terms for purposes of this Agreement. Nothing in the Disclosure
Schedules constitutes an admission of any liability or obligation of the disclosing party to any third party or an admission to any third
party, including any Authority, against the interest of the disclosing party, including any possible breach of violation of any Contract
or Law. Summaries of or reference to any written document
in the Disclosure Schedules do not purport to be complete and are qualified in their entirety by the written document itself. The Disclosures
Schedules and the information and disclosures contained therein are intended only to qualify and limit the representations and warranties
of the parties contained in this Agreement, and shall not be deemed to expand in any way the scope or effect of any of such representations
and warranties. The headings contained in the Disclosure Schedules are included for convenience only, and are not intended to limit the
effect of the disclosures contained in the Disclosure Schedules or to expand the scope of information required to be disclosed in the
Disclosure Schedules. Parent acknowledges that certain information contained in the Disclosure Schedules may constitute material confidential
information relating to the Company Group and DLQ Parent that may not be used for any purpose other than that contemplated in the Agreement.
The Company Group and DLQ Parent are not waiving, and will be not be deemed to have waived or diminished, any of their attorney work product
protections, attorney-client privileges or similar protections and privileges as a result of disclosing its confidential information (including
confidential information related to pending or threatened litigation) to Parent, regardless of whether the Company Group and/or DLQ Parent
have asserted, or are or may be entitled to assert, such privileges and protections. The parties share a common legal and commercial interest
in ensuring all of the members’ of the Company Group and DLQ Parent’s confidential information remains subject to such privileges
and protections. Parent shall not admit, claim or contend, in proceedings involving any party hereto or otherwise, that any member of
the Company Group and/or DLQ Parent have waived any of their attorney work-product protections, attorney-client privileges or similar
protections and privileges with respect to any information, documents or other materials disclosed in the Disclosure Schedules due to
any member of the Company Group and/or DLQ Parent disclosing such information in the Disclosure Schedule.
(f)
If any action is required to be taken or notice is required to be given within a specified number of days following a specific date or
event, the day of such date or event is not counted in determining the last day for such action or notice. If any action is required to
be taken or notice is required to be given on or before a particular day which is not a Business Day, such action or notice shall be considered
timely if it is taken or given on or before the next Business Day.
(g)
To the extent that any Contract, document, certificate or instrument is represented and warranted to by the Company to be given, delivered,
provided or made available by the Company, such Contract, document, certificate or instrument shall be deemed to have been given, delivered,
provided and made available to Parent or its Representatives, if such Contract, document, certificate or instrument shall have been posted
not later than one (1) Business Day prior to the date of this Agreement to the electronic data site maintained on behalf of the Company
for the benefit of the Parent and its Representatives and the Parent and its Representatives have been given access to the electronic
folders containing such information.
ARTICLE II
MERGER
2.1 Merger.
Upon the terms and subject to the conditions set forth in this Agreement, and in accordance with the General Corporation Law of the State
of Delaware (the “DGCL”) and the Nevada Revised Statutes (the “NRS”), at the Effective Time, (a)
Merger Sub shall be merged with and into the Company, (b) the separate corporate existence of Merger Sub shall thereupon cease, and the
Company shall be the Surviving Corporation, which shall be named “DLQ, Inc.”, and (c) the Surviving Corporation shall become
a wholly-owned Subsidiary of Parent, which shall change its name to “DataLogiq, Inc.”
2.2 Merger
Effective Time. Subject to the provisions of this Agreement, at the Closing, the Company shall file with the Secretary of State of
the State of Delaware a certificate of merger (the “Delaware Certificate of Merger”) and Secretary of State of the
State of Nevada articles of merger (the “Nevada Articles of Merger”) in form and substance reasonably acceptable to
Company and Parent, executed in accordance with the relevant provisions of the DGCL and the NRS (the Delaware Certificate of Merger and
the Nevada Articles of Merger, collectively, the “Certificates of Merger”). The Merger shall become effective upon
the filing of the Certificates of Merger or at such later time as is agreed to by the Parties and specified in the Certificates of Merger
(the time at which the Merger becomes effective is herein referred to as the “Effective Time”).
2.3 Effect
of the Merger. At the Effective Time, the effect of the Merger shall be as provided in this Agreement, the Certificates of Merger
and the applicable provisions of the DGCL and the NRS. Without limiting the generality of the foregoing, and subject thereto, at the Effective
Time, all the assets, property, rights, privileges, immunities, powers and franchises of the Company and Merger Sub shall vest in the
Surviving Corporation and all debts, liabilities and duties of the Company and Merger Sub shall become the debts, liabilities and duties
of the Surviving Corporation.
2.4 U.S.
Tax Treatment. For U.S. federal income tax purposes, the Merger is intended to constitute a “reorganization” within the
meaning of Section 368(a) of the Code. The parties to this Agreement hereby (i) adopt this Agreement insofar as it relates to the Merger
as a “plan of reorganization” within the meaning of Section 1.368-2(g) of the United States Treasury regulations, (ii) agree
to file and retain such information as shall be required under Section 1.368-3 of the United States Treasury regulations, and (iii) agree
to file all Tax and other informational returns on a basis consistent with such characterization. Notwithstanding the foregoing or anything
else to the contrary contained in this Agreement, the parties acknowledge and agree that, other than the representations set forth in
Sections 4.24(e) and 5.22(e), no party is making any representation or warranty as to the qualification of the Merger as a reorganization
under Section 368(a) of the Code or as to the effect, if any, that any transaction consummated on, after or prior to the Effective Time
has or may have on any such reorganization status. Each of the parties acknowledges and agrees that each such party (A) has had the opportunity
to obtain independent legal and tax advice with respect to the transactions contemplated by this Agreement and (B) is responsible for
paying its own Taxes, including any adverse Tax consequences that may result if the Merger is determined not to qualify as a reorganization
under Section 368(a) of the Code.
2.5 Articles
of Incorporation; Bylaws.
(a)
The Company Certificate of Incorporation as in effect immediately prior to the Effective Time shall, in accordance with the terms thereof
and the NRS, be amended and restated in its entirety as set forth in the exhibit to the Nevada Articles of Merger, and, as so amended
and restated, shall be the articles of incorporation of the Surviving Corporation until duly amended in accordance with the terms thereof
and the NRS.
(b)
The Bylaws of the Company as in effect immediately prior to the Effective Time shall be amended at the Effective Time to read in its entirety
as the Bylaws of Merger Sub as in effect immediately prior to the Effective Time, except that the name of the Surviving Corporation shall
be “DataLogiq, Inc.”, until thereafter amended in accordance with the terms thereof, the articles of incorporation of the
Surviving Corporation and applicable Law.
2.6 Closing.
Unless this Agreement is earlier terminated in accordance with ARTICLE X, the consummation of the Merger (the “Closing”)
shall take place virtually at 10:00 a.m. Eastern time, on the fifth (5th) Business Day after the satisfaction or waiver (to
the extent permitted by applicable law) of the conditions set forth in ARTICLE IX or at such other time, date and location
as Parent and Company agree in writing. The parties may participate in the Closing via electronic means. The date on which the Closing
actually occurs is hereinafter referred to as the “Closing Date”.
2.7 Directors
and Officers of Surviving Corporation.
(a)
At the Effective Time, Parent and the Company shall take all actions necessary to cause the directors of the Company immediately prior
to the Effective Time to be the only directors of the Surviving Corporation immediately after the Effective Time, and such directors shall
hold office until their successors shall have been duly elected or appointed and qualified or until their earlier death, resignation or
removal in accordance with the Surviving Corporation’s articles of incorporation and bylaws.
(b)
At the Effective Time, the officers of the Company as of immediately prior to the Effective Time shall become the initial officers of
the Surviving Corporation and shall hold office until their respective successors are duly elected or appointed and qualified, or until
their earlier death, resignation or removal.
2.8 Directors
and Officers of Parent. At the Effective Time, Parent’s Board of Directors will consist of five (5) directors. The Sponsor shall
have the right to designate three (3) independent directors, and the Company shall have the right to designate two (2) directors in accordance
with the Voting Agreement. At least a majority of the Board of Directors shall qualify as independent directors under the Securities Act
and the NASDAQ rules. At or prior to the Closing, Parent will provide each member of Parent’s and Surviving Corporation’s
post-Closing Board of Directors with a customary director indemnification agreement, in form and substance reasonable acceptable to the
directors, to be effective upon the Closing (or if later, such director’s appointment). Parent’s Board of Directors shall
take all necessary actions to remove all officers of Parent as of immediately prior to the Effective Time and cause officers who are mutually
agreed upon among the parties to become the officers of Parent as of the Effective Time, such persons to hold office until their respective
successors are duly elected or appointed and qualified, or until their earlier death, resignation or removal.
2.9 Taking
of Necessary Action; Further Action. If, at any time after the Closing, any further action is necessary or desirable to carry out
the purposes of this Agreement and to vest the Surviving Corporation with full right, title and interest in, to and under, or possession
of, all assets, property, rights, privileges, powers and franchises of the Company and Merger Sub, the officers and directors of the Surviving
Corporation are fully authorized in the name and on behalf of the Company and Merger Sub, to take all lawful action necessary or desirable
to accomplish such purpose or acts, so long as such action is not inconsistent with this Agreement.
2.10 No
Further Ownership Rights in Company Capital Stock. All Merger Consideration Shares paid or payable in respect of shares of Company
Common Stock hereunder, shall be deemed to have been paid or payable in full satisfaction of all rights pertaining to such shares of Company
Common Stock and from and after the Effective Time, there shall be no further registration of transfers of shares of the Company Common
Stock on the stock transfer books of the Surviving Corporation.
ARTICLE III
EFFECT OF THE MERGER AND RELATED MATTERS
3.1 Effect
of the Merger on Company Common Stock. At the Effective Time, as a result of the Merger and without any action on the part of Parent,
Merger Sub, the Company or the holders of any shares of common stock of any of them:
(a) Cancellation
of Certain Shares of Company Common Stock. Each share of Company Common Stock, if any, that is owned by Parent or Merger Sub (or any
other Affiliate of Parent) or the Company (or any of its Subsidiaries) (as treasury stock or otherwise), will automatically be cancelled
and retired without any conversion thereof and will cease to exist, and no consideration will be delivered in exchange therefor. Each
share of Company Common Stock, if any, held immediately prior to the Effective Time by the Company as treasury stock shall be automatically
cancelled and extinguished, and no consideration shall be paid with respect thereto.
(b) Conversion
of Shares of Company Common Stock. Each share of Company Common Stock issued and outstanding immediately prior to the Effective Time
(other than any such shares of Company Common Stock cancelled pursuant to Section 3.1(a)) shall, in accordance with the Company
Certificate of Incorporation and subject to this Agreement, be converted into the right to receive a number of shares of Parent Common
Stock equal to the Conversion Ratio.
(c) Conversion
of Merger Sub Capital Stock. Each share of common stock, par value $0.0001 per share, of Merger Sub issued and outstanding immediately
prior to the Effective Time shall be converted into and become one newly issued, fully paid and nonassessable share of common stock of
the Surviving Corporation.
3.2 Surrender
and Payment. At the Effective Time, Parent will deliver to DLQ Parent the Merger Consideration Shares.
3.3 Distribution
Matters.
(a) Record
Date and Distribution Date. Prior to the Closing, the Board of Directors of DLQ Parent in consultation with Parent, consistent with
this Agreement and applicable Law, shall establish the Record Date and the Distribution Date and any necessary or appropriate procedures
in connection with the Distribution; provided, that DLQ Parent shall provide Parent written notice no fewer than two Business Days prior
to DLQ Parent’s announcement of the Record Date to its stockholders.
(b) Delivery
of Dividend Shares to the Agent. At or prior to the Distribution Date, DLQ Parent shall authorize the book-entry transfer by the exchange
agent designated by DLQ Parent (the “Agent”) of all of the Dividend Shares to be distributed in connection with the
Distribution.
(c) The
Distribution.
(i)
Upon the terms and subject to the conditions of this Agreement, concurrently with the receipt of the Merger Consideration Shares as provided
in Section 3.2, DLQ Parent shall declare and effect the Distribution, in accordance with Section 3.3(c)(iii), to each holder of issued
and outstanding shares of DLQ Parent Common Stock as of the Record Date (excluding treasury shares held by DLQ Parent), such that each
such holder will receive a pro-rata share of the aggregate Dividend Shares held by DLQ Parent as of the Distribution Time.
(ii)
Any fractional Dividend Shares that would otherwise be issuable to a DLQ Parent Stockholder pursuant to Section 3.3(c)(i) shall be aggregated
and such DLQ Parent Stockholder shall be issued in respect of all such fractional shares a number of Dividend Shares equal to such aggregate
number, rounded to the nearest whole number. In the event that after giving effect to this Section 3.3(c)(ii) the aggregate number of
Dividend Shares issued to the DLQ Parent Stockholders is greater than the number of Dividend Shares to be issued, the Dividend Shares
number shall be deemed to be amended to include such number of additional Dividend Shares issued pursuant to this Section 3.3(c)(ii).
(iii)
At or prior to the Distribution Time, DLQ Parent shall deliver to the Agent evidence of Dividend Shares in book-entry form being distributed
in the Distribution for the account of the holders of DLQ Parent Common Stock that are entitled thereto pursuant to Section 3.3(c)(i)
or Section 3.3(c)(ii). The Agent shall hold such evidence of Dividend Shares in book-entry form for the account of such holders of DLQ
Parent Common Stock pending the Merger. Immediately after the Effective Time of the Merger and prior to the Distribution Time, the Dividend
Shares shall not be transferable and the Agent shall not transfer any Dividend Shares. The Distribution shall be deemed to be effective
upon written authorization from DLQ Parent to the Agent to proceed, after the receipt of which the Agent shall then distribute by book-entry
transfer in respect of the outstanding shares of DLQ Parent Common Stock held by holders of record of DLQ Parent Common Stock on the Record
Date (excluding treasury shares held by DLQ Parent) all of the Dividend Shares distributed in the Distribution pursuant to Section 3.3(c)(i)
and Section 3.3(c)(ii).
3.5 Consideration
Spreadsheet.
(a)
At least three (3) Business Days prior to the Closing, the Company shall deliver to Parent a spreadsheet (the “Consideration
Spreadsheet”), prepared by the Company in good faith and detailing the following, in each case, as of immediately prior to the
Effective Time:
(i)
the number of Fully Diluted Company Shares;
(ii)
detailed calculations of each of the following (in each case, determined without regard to withholding):
(A)
the Per Share Merger Consideration Amount;
(B)
the Conversion Ratio;
(C)
the Merger Consideration Shares;
(iii)
any explanatory or supporting information, including calculations, as Parent may reasonably request.
(b)
The contents of the Consideration Spreadsheet delivered by the Company hereunder shall be subject to reasonable review and comment by
Parent, but the Company shall, in all events, remain solely responsible for the contents of the Consideration Spreadsheet. Under no circumstances
shall Parent or Merger Sub be responsible for the calculations or the determinations regarding such calculations in the Consideration
Spreadsheet and the parties agree that Parent and Merger Sub shall be entitled to rely on the Consideration Spreadsheet in making payments
under ARTICLE III.
(c)
Nothing contained in this Section 3.3 or in the Consideration Spreadsheet shall be construed or deemed to: (i) modify
the Company’s obligations to obtain Parent’s prior consent to the issuance of any securities pursuant to Section 6.1(a)(xviii);
or (ii) alter or amend the definition of Per Share Merger Consideration Amount or Merger Consideration Shares.
3.6 Earnout.
From and after the Closing until the third anniversary of the Closing Date (the “Earnout Period”), certain members
of management of the Company and Sponsor shall each be entitled to receive certain additional shares of Parent Common Stock upon the fulfilment
of certain milestones upon the terms set forth in the Management Earnout Agreement and Sponsor Earnout Agreement.
3.7 Adjustment.
The Merger Consideration Shares and Conversion Ratio shall be adjusted to reflect appropriately the effect of any stock split, reverse
stock split, stock dividend, recapitalization, reclassification, combination, exchange of shares or other like change with respect to
shares of Parent Common Stock occurring prior to the date the Merger Consideration Shares are issued.
3.8 No
Fractional Shares. No fractional shares of Parent Common Stock, or certificates or scrip representing fractional shares of Parent
Common Stock, will be issued upon the conversion of the shares of Company Common Stock pursuant to the Merger, and such fractional share
interests will not entitle the owner thereof to vote or to any rights of a stockholder of Parent. Any fractional shares of Parent Common
Stock will be rounded up or down to the nearest whole number of shares of Parent Common Stock.
3.9 Withholding.
Parent and the Surviving Corporation shall be entitled to deduct and withhold from the consideration otherwise payable to any Person pursuant
to this Agreement such amounts as may be required to be deducted or withheld with respect to the making of such payment under the Code,
or under any provision of state, local or non-U.S. Tax Law. To the extent that amounts are so deducted and withheld and paid over to the
appropriate Taxing Authorities, such amounts shall be treated for all purposes under this Agreement as having been paid to the Person
in respect of which such deduction and withholding was made. Notwithstanding the foregoing, Parent and the Surviving Corporation shall
provide notice of any withholding that either intends to make (or cause to be made) in connection with consideration payable or otherwise
deliverable pursuant to this Agreement at least five (5) days prior to the date of the relevant payment and shall use commercially reasonable
efforts to reduce or eliminate any such withholding, including providing recipients of consideration a reasonable opportunity to provide
documentation establishing exemptions from or reductions of such withholdings.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
OF THE COMPANY AND DLQ PARENT
Except
as disclosed in the DLQ Parent SEC Documents filed with or furnished to the SEC in unredacted form no later than the second day prior
to the date of this Agreement and available to public access through the EDGAR database (other than any risk factor disclosures or other
similar cautionary or predictive statements therein) (and to the extent the qualifying nature of such disclosure is reasonably apparent
on its face) or set forth in the disclosure schedules delivered by the Company and DLQ Parent to Parent concurrently with the execution
of this Agreement (the “Disclosure Schedules”) (with specific reference to the particular section or subsection of
this Agreement to which the information set forth in such disclosure letter relates) (which qualify (a) the correspondingly numbered representation,
warranty or covenant specified therein and (b) such other representations, warranties or covenants where its relevance as an exception
to (or disclosure for purposes of) such other representation, warranty or covenant is reasonably apparent on its face or cross-referenced);
provided that nothing disclosed in any such Parent SEC Document will be deemed to modify or qualify the representations and warranties
set forth in Section 4.1 (Corporate Existence and Power), Section 4.2 (Authorization) and Section
4.5 (Capitalization); DLQ Parent and the Company jointly and severally represent and warrant to Parent that each of the following
representations and warranties are true and correct as of the date of this Agreement (except for representations and warranties that are
made as of a specific date, which are made only as of such date); provided, however, that any representation and warranty of the Company
which references the Company Group shall only be deemed to apply to the Company and its Subsidiaries.
4.1 Corporate Existence
and Power. Except as set forth on Schedule 4.1 the Company and each other member of the Company Group is a corporation
or legal entity duly organized, validly existing and in good standing (with respect to jurisdictions that recognize that concept) under
the laws of its jurisdiction of its incorporation or formation, as the case may be. The Company and each other member of the Company
Group has all requisite corporate or limited liability company, as applicable, power and authority to own, lease or otherwise hold and
operate its properties and other assets and to carry on the Business as currently conducted. Except as set forth on Schedule
4.1, the Company and each other member of the Company Group is duly licensed or qualified to do business and is in good standing
(with respect to jurisdictions that recognize that concept) in each jurisdiction in which the nature of its business or the ownership,
leasing or operation of its properties or other assets makes such qualification, licensing or good standing necessary, except where the
failure to be so qualified, licensed or in good standing, individually or in the aggregate, has not had and would not reasonably be expected
to have a Material Adverse Effect in respect of the Company Group. The Company and each other member of the Company Group has offices
located only at the addresses set forth on Schedule 4.1. The Company has made available to Parent, prior to the date of this
Agreement, complete and accurate copies of the Company Certificate of Incorporation and the Company’s Bylaws, and the comparable
organizational documents of each of its Subsidiaries, in each case as amended to the date hereof. The Company Certificate of Incorporation,
the Company’s Bylaws and the comparable organizational or constitutive documents of the Company’s Subsidiaries so delivered
are in full force and effect. The Company is not in violation of the Company Certificate of Incorporation or the Company’s Bylaws
and each of its Subsidiaries is not in violation of its respective comparable organizational or constitutive documents.
4.2 Authorization.
(a)
The Company and DLQ Parent each has all requisite corporate power and authority to execute and deliver this Agreement and the Additional
Agreements to which it is a party and to consummate the transactions contemplated hereby and thereby, in the case of the Merger, subject
to receipt of the Company Stockholder Approval and the DLQ Parent Stockholder Approval. The execution and delivery by the Company of this
Agreement and the Additional Agreements to which it is a party and the consummation by the Company and DLQ Parent of the transactions
contemplated hereby and thereby have been duly authorized by all necessary corporate action on the part of the Company or DLQ Parent,
as the case may be (other than, in the case of the Merger, the receipt of the Company Stockholder Approval or the DLQ Parent Stockholder
Approval). No other corporate proceedings on the part of the Company or DLQ Parent are necessary to authorize this Agreement or the Additional
Agreements to which it is a party or to consummate the transactions contemplated by this Agreement (other than, in the case of the Merger,
the receipt of the Company Stockholder Approval or the DLQ Parent Stockholder Approval) or the Additional Agreements. This Agreement and
the Additional Agreements to which the Company or DLQ Parent is a party have been duly executed and delivered by the Company or DLQ Parent,
as the case may be, and, assuming the due authorization, execution and delivery by each of the other parties hereto and thereto, this
Agreement and the Additional Agreements to which the Company or DLQ Parent is a party constitute a legal, valid and binding obligation
of the Company or DLQ Parent, enforceable against the Company in accordance with their respective terms, subject to bankruptcy, insolvency,
fraudulent transfer, moratorium, reorganization or similar Laws affecting the rights of creditors generally and the availability of equitable
remedies (the “Enforceability Exceptions”).
(b)
By resolutions duly adopted (and not thereafter modified or rescinded) by the requisite vote of the Board of Directors of the Company,
the Board of Directors of the Company has (i) approved the execution, delivery and performance by the Company of this Agreement, the Additional
Agreements to which it is a party and the consummation of the transactions contemplated hereby and thereby, including the Merger, on the
terms and subject to the conditions set forth herein and therein; (ii) determined that this Agreement, the Additional Agreements to which
it is a party, and the transactions contemplated hereby and thereby, upon the terms and subject to the conditions set forth herein, are
advisable and in the best interests of the Company and the Company Stockholders; (iii) directed that the adoption of this Agreement be
submitted to the Company Stockholders for consideration and recommended that all of the Company Stockholders adopt this Agreement. The
affirmative vote or written consent of DLQ Parent as the sole stockholder of the Company (the “Company Stockholder Approval”)
is the only vote or consent of any of the holders of Company Common Stock necessary to adopt this Agreement and approve the Merger and
the consummation of the other transactions contemplated hereby.
(c)
By resolutions duly adopted (and not thereafter modified or rescinded) by the requisite vote of the Board of Directors of DLQ Parent,
the Board of Directors of DLQ Parent has (i) approved the execution, delivery and performance by DLQ Parent of this Agreement, the Additional
Agreements to which it is a party and the consummation of the transactions contemplated hereby and thereby, including the Merger, on the
terms and subject to the conditions set forth herein and therein; (ii) determined that this Agreement, the Additional Agreements to which
it is a party, and the transactions contemplated hereby and thereby, upon the terms and subject to the conditions set forth herein, are
advisable and in the best interests of DLQ Parent and the DLQ Parent Stockholders; (iii) directed that the adoption of this Agreement
be submitted to the DLQ Parent Stockholders for consideration and recommended that all of the DLQ Parent Stockholders adopt this Agreement.
The affirmative vote or written consent of holders of a majority of the then outstanding shares of the common stock of DLQ Parent present
in person or by proxy and entitled to vote at the DLQ Parent Stockholder Meeting, assuming a quorum is present (the “DLQ Parent
Stockholder Approval”), is the only vote of the holders of any of DLQ Parent’s capital stock necessary to adopt this Agreement
and approve the Merger and the consummation of the other transactions contemplated hereby.
4.3 Governmental
Authorization. None of the execution, delivery or performance by the Company or DLQ Parent of this Agreement or any Additional Agreement
to which DLQ Parent or any member of the Company Group is or will be a party, or the consummation of the transactions contemplated hereby
or thereby, requires any consent, approval, license, Order or other action by or in respect of, or registration, declaration or filing
with, any Authority, except for the filing of the Delaware Certificate of Merger with the Secretary of State of the State of Delaware
pursuant to the DGCL and Nevada Articles of Merger with the Secretary of State of the State of Nevada pursuant to the NRS.
4.4 Non-Contravention.
None of the execution, delivery or performance by the Company of this Agreement or any Additional Agreement to which any member of the
Company Group is or will be a party or the consummation by the Company Group of the transactions contemplated hereby and thereby does
or will (a) contravene or conflict with the organizational or constitutive documents of any member of the Company Group, (b) contravene
or conflict with or constitute a violation of any provision of any Law or Order binding upon or applicable to any member of the Company
Group or to any of their respective properties, rights or assets, (c) except for the Material Contracts listed on Schedule 4.8 requiring
Company Group Consents (but only as to the need to obtain such Company Group Consents) and as set forth on Schedule 4.4 (c),
(i) require consent, approval or waiver under, (ii) constitute a default under or breach of (with or without the giving of notice or the
passage of time or both), (iii) violate, (iv) give rise to any right of termination, cancellation, amendment or acceleration of any right
or obligation of the Company Group or to a loss of any material benefit to which any member of the Company Group is entitled, in the case
of each of clauses (i) – (iv), under any provision of any Permit or Material Contract binding upon any member of the Company Group
or any of their respective properties, rights or assets, (d) result in the creation or imposition of any Lien (except for Permitted Liens)
on any of the Company Group’s properties, rights or assets, or (e) require any consent, approval or waiver from any Person pursuant
to any provision of any Company Group Certificate of Incorporation or the Bylaws of any member of the Company Group or the organizational
or constitutive documents of any other member of the Company Group, except for such consent, approval or waiver which shall be obtained
(and a copy provided to Parent) prior to the Closing.
4.5 Capitalization.
(a)
As of the date hereof, the authorized capital stock of the Company consists of 2,000 shares of Common Stock, all of which are outstanding.
No other shares of capital stock or other voting securities of the Company are authorized, issued, reserved for issuance or outstanding.
All issued and outstanding shares of Company Common Stock are duly authorized, validly issued, fully paid and non-assessable. No shares
of Company Common Stock are subject to or were issued in violation of any purchase option, right of first refusal, preemptive right, subscription
right or any similar right (including under any provision of the NRS, the Company Certificate of Incorporation or any Contract to which
the Company is a party or by which the Company or any of its properties, rights or assets are bound). As of the date of this Agreement,
all outstanding shares of Company Common Stock are owned of record by DLQ Parent.
(b)
As of the date hereof, the authorized capital stock of Rebel AI, Inc. consists of 10,000 shares of Common Stock, all of which are outstanding.
No other shares of capital stock or other voting securities of Rebel AI, Inc. are authorized, issued, reserved for issuance or outstanding.
All issued and outstanding shares of common stock of Rebel AI, Inc. are duly authorized, validly issued, fully paid and non-assessable.
No shares of the common stock of Rebel AI, Inc. are subject to or were issued in violation of any purchase option, right of first refusal,
preemptive right, subscription right or any similar right (including under any provision of the DGCL, Rebel AI, Inc.’s certificate
of incorporation or any Contract to which Rebel AI, Inc. is a party or by which it or any of its properties, rights or assets are bound).
As of the date of this Agreement, all outstanding shares of Rebel AI, Inc. are owned of record by DLQ Parent.
(c)
As of the date hereof, the authorized capital stock of Fixel AI, Inc. consists of 10,000,000 shares of Common Stock, 100,000 of which
are outstanding. No other shares of capital stock or other voting securities of Fixel AI, Inc. are authorized, issued, reserved for issuance
or outstanding. All issued and outstanding shares of common stock of Fixel AI, Inc. are duly authorized, validly issued, fully paid and
non-assessable. No shares of the common stock of Fixel AI, Inc. are subject to or were issued in violation of any purchase option, right
of first refusal, preemptive right, subscription right or any similar right (including under any provision of the DGCL, Fixel AI, Inc.’s
certificate of incorporation or any Contract to which Fixel AI, Inc. is a party or by which it or any of its properties, rights or assets
are bound). As of the date of this Agreement, all outstanding shares of Fixel AI, Inc. are owned of record by DLQ Parent.
(d)
As of the date hereof, the authorized capital stock of Tamble, Inc. consists of 1,000 shares of Common Stock, all of which are outstanding.
No other shares of capital stock or other voting securities of Tamble, Inc. are authorized, issued, reserved for issuance or outstanding.
All issued and outstanding shares of common stock of Tamble, Inc. are duly authorized, validly issued, fully paid and non-assessable.
No shares of the common stock of Tamble, Inc. are subject to or were issued in violation of any purchase option, right of first refusal,
preemptive right, subscription right or any similar right (including under any provision of the DGCL, Tamble, Inc.’s certificate
of incorporation or any Contract to which Tamble, Inc. is a party or by which it or any of its properties, rights or assets are bound).
As of the date of this Agreement, all outstanding shares of Tamble, Inc. are owned of record by the Company.
(e)
As of the date hereof, the authorized equity securities of Push Interactive, LLC consists of 1,000,000 membership units, all of which
are outstanding. No other equity securities or other voting securities of Push Interactive, LLC are authorized, issued, reserved for issuance
or outstanding. All issued and outstanding equity securities of Push Interactive, LLC are duly authorized, validly issued, fully paid
and non-assessable. No equity securities of Push Interactive, LLC are subject to or were issued in violation of any purchase option, right
of first refusal, preemptive right, subscription right or any similar right (including under any provision of the Minnesota Revised Uniform
Limited Liability Company Act, Push Interactive, LLC’s certificate of formation or any Contract to which Push Interactive, LLC is
a party or by which it or any of its properties, rights or assets are bound). As of the date of this Agreement, all outstanding equity
securities of Push Interactive, LLC are owned of record by the Company.
(f)
As of the date of this Agreement, all membership interests of Battlebridge Acquisition Co, LLC are owned of record by the Company. No
other equity securities or other voting securities of Battlebridge Acquisition Co, LLC are authorized, issued, reserved for issuance or
outstanding. All issued and outstanding equity securities of Battlebridge Acquisition Co, LLC are duly authorized, validly issued, fully
paid and non-assessable. No equity securities of Battlebridge Acquisition Co, LLC are subject to or were issued in violation of any purchase
option, right of first refusal, preemptive right, subscription right or any similar right (including under any provision of the Nevada
Limited Liability Company Act, Battlebridge Acquisition Co, LLC’s certificate of formation or any Contract to which Battlebridge
Acquisition Co, LLC is a party or by which it or any of its properties, rights or assets are bound).
(g)
Except as listed on Schedule 4.5(g), there are no (i) outstanding warrants, options, agreements, convertible securities, performance
units or other commitments or instruments pursuant to which any member of the Company Group is or may become obligated to issue or sell
any of its shares of capital stock or other securities, (ii) outstanding obligations of the Company Group to repurchase, redeem or
otherwise acquire outstanding capital stock of the Company Group or any securities convertible into or exchangeable for any shares of
capital stock of the Company Group, (iii) treasury shares of capital stock of the Company Group, (iv) bonds, debentures, notes or other
Indebtedness of the Company Group having the right to vote (or convertible into, or exchangeable for, securities having the right to vote)
on any matters on which stockholders of the Company Group may vote, issued or outstanding, (v) preemptive or similar rights to purchase
or otherwise acquire shares or other securities of the Company Group (including pursuant to any provision of Law, the Company Group Certificates
of Incorporation or any Contract to which any member of the Company Group is a party), or (vi) Liens (including any right of first refusal,
right of first offer, proxy, voting trust, voting agreement or similar arrangement) with respect to the sale or voting of shares or securities
of the Company Group (whether outstanding or issuable).
(h)
The Consideration Spreadsheet, when delivered by the Company pursuant to Section 3.3(a), will be true, complete and correct
in all material respects as of immediately prior to the Effective Time.
4.6 Corporate
Records. Except as set forth on Schedule 4.6, all proceedings of the Board of Directors of each member of the Company
Group, including all committees thereof, and of the Company Group’s Stockholders, and all consents to actions taken thereby, are
accurately reflected in the minutes and records contained in the corporate minute books of the Company Group and made available to Parent.
The stockholder ledgers of the Company Group are true, correct and complete.
4.7 Subsidiaries. Schedule
4.7 lists each Subsidiary of the Company Group (including its jurisdiction of incorporation or formation). All the issued and
outstanding shares of capital stock of, or other equity interests in, each Subsidiary of the Company have been validly issued and are
fully paid and non-assessable and are owned directly or indirectly by the Company Group free and clear of all Liens except for restrictions
on transfer under applicable securities Laws. Except for the Subsidiaries of the Company Group, the Company Group does not own, directly
or indirectly, as of the date hereof, (i) any capital stock of, or other voting securities or other equity or voting interests in, any
Person or (ii) any other interest or participation that confers on the Company Group or any Subsidiary of the Company Group the right
to receive (A) a share of the profits and losses of, or distributions of assets of, any other Person or (B) any economic benefit or right
similar to, or derived from, the economic benefits and rights occurring to holders of capital stock of any other Person.
4.8 Consents.
The Contracts listed on Schedule 4.8 are the only Material Contracts requiring a consent, approval, authorization, order
or other action of or filing with any Person as a result of the execution, delivery and performance of this Agreement or any Additional
Agreement to which the Company Group is or will be a party or the consummation of the transactions contemplated hereby or thereby (each
of the foregoing, a “Company Group Consent”).
4.9 Financial
Statements.
(a)
Since December 31, 2021 (the “Balance Sheet Date”), except as required by applicable Law or U.S. GAAP, there has been
no change in any accounting principle, procedure or practice followed by the Company or in the method of applying any such principle,
procedure or practice.
(b)
Except as: (i) specifically disclosed, reflected or fully reserved against on the Balance Sheet; (ii) liabilities and obligations incurred
in the ordinary course of business consistent with past practices since the date of the Balance Sheet; (iii) liabilities that are executory
obligations arising under Contracts to which a member of the Company Group is a party (none of which, with respect to the liabilities
described in clause (ii) and this clause (iii) results from, arises out of, or relates to any breach or violation of, or default under,
a Contract or applicable Law); (iv) expenses incurred in connection with the negotiation, execution and performance of this Agreement,
any Additional Agreement or any of the transactions contemplated hereby or thereby; and (v) liabilities set forth on Schedule
4.9(b), the Company Group does not have any material liabilities, debts or obligations of the type required to be set forth on the
face of a balance sheet prepared in accordance with U.S. GAAP (whether accrued, fixed or contingent, liquidated or unliquidated or asserted
or, to the Knowledge of the Company or DLQ Parent, unasserted).
(c)
Except as set forth on Schedule 4.9(c), the Company Group does not have any Indebtedness for borrowed money or any other material
Indebtedness.
4.10 Books
and Records. Except as set forth on Schedule 4.10, the Books and Records accurately and fairly, in reasonable detail,
reflect the transactions and dispositions of assets of and the providing of services by the Company Group. Except as set forth on Schedule
4.10, the Books and Records of the Company have been maintained, in all material respects in accordance with reasonable business practice.
4.11 Internal
Accounting Controls. The Company Group has established a system of internal accounting controls sufficient to provide reasonable assurance
that: (a) transactions are executed in accordance with management’s general or specific authorizations; (b) transactions are recorded
as necessary to permit preparation of financial statements in conformity with U.S. GAAP, and the Company Group’s historical practices
and to maintain asset accountability; (c) access to assets is permitted only in accordance with management’s general or specific
authorization; and (d) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate
action is taken with respect to any differences.
4.12 Absence
of Certain Changes. Except as set forth on Schedule 4.12, from January 1, 2022 until the date of this Agreement, (a) the
Company and each other member of the Company Group have conducted their respective businesses in the ordinary course and in a manner consistent
with past practice; (b) there has not been any Material Adverse Effect in respect of the Company Group; and (c) neither the Company nor
any other member of the Company Group has taken any action that, if taken after the date of this Agreement and prior to the consummation
of the Merger, would require the consent of Parent pursuant to Section 6.1 and Parent has not given consent.
4.13 Properties;
Title to the Company’s Assets.
(a)
All items of Tangible Personal Property in the aggregate are in good operating condition and repair and function in all material respects
in the aggregate in accordance with their intended uses (ordinary wear and tear excepted).
(b) The Company Group or
a Subsidiary has good, valid and marketable title in and to the material tangible assets reflected in the Balance Sheet, other than any
such tangible assets which have been disposed of since the Balance Sheet Date in the ordinary course of business. The Company Group or
a Subsidiary has a valid leasehold interest or license in or a right to use the aggregate tangible assets reflected on the Balance Sheet
that are leased or licensed by the Company pursuant to a Contract, other than any such assets that were leased or licensed pursuant to
a Contract that has terminated since the Balance Sheet Date. Except as set forth on Schedule 4.13(b), no such tangible
asset is subject to any material Lien other than Permitted Liens. Subject to the provisions of Section 4.18, the Company Group’s
assets constitute substantially all of the rights, properties, and assets of any kind or description whatsoever, including the goodwill,
used or held for use in connection with the Company’s business.
4.14 Litigation.
Except as set forth on Schedule 4.14 (i) there is no Action for damages in excess of $100,000 or that is otherwise material
to the Company Group that is pending or, to the Knowledge of the Company or DLQ Parent, threatened against the Company Group, any of the
officers or directors of the Company Group in their capacity as such, or any of the Company Group’s rights, properties or assets
before any Authority or which in any manner challenges or seeks to prevent, enjoin, alter or delay the transactions contemplated by this
Agreement or any Additional Agreement and (ii) The Company Group is not subject to any Action by any Authority. There are no outstanding
judgments against the Company Group.
4.15 Contracts.
(a) Schedule
4.15(a) sets forth a true, complete and accurate list, as of the date of this Agreement, of all of the following Contracts as
amended to date which are currently in effect (collectively, “Material Contracts”):
(i)
all Contracts that require annual payments or expenses incurred by, or annual payments or income to, the Company Group of $100,000 or
more (other than standard purchase and sale orders entered into in the ordinary course of business consistent with past practices);
(ii)
all sales, advertising, agency, lobbying, broker, sales promotion, market research, marketing or similar Contracts that require annual
payments of $100,000 or more;
(iii)
each Contract with any current officer, director, employee or consultant of the Company Group, under which the Company Group (A) has continuing
obligations for payment of an annual compensation of at least $100,000, and which is not terminable for any reason or no reason upon reasonable
notice without payment of any penalty, severance or other obligation; (B) has severance or post-termination obligations to such Person
in excess of $75,000 (other than COBRA obligations); or (C) has an obligation to make a payment upon consummation of the transactions
contemplated hereby;
(iv)
all Contracts with third parties creating a limited liability company or legal partnership arrangement or a material joint venture or
strategic alliance to which the Company Group is a party;
(v)
all Contracts relating to any acquisitions or dispositions of material assets by the Company Group (other than acquisitions or dispositions
of inventory in the ordinary course of business consistent with past practices) under which the Company Group has any continuing obligations
(other than confidentiality requirements);
(vi)
all IP Contracts, and identifying whether each scheduled IP Contract is a Company IP Contract, a Related Company Inbound IP Contract,
a Related Company Outbound IP Contract or a Related Company Settlement Agreement and separately indicating whether any Related Company
Outbound IP Agreement is not cancellable or terminable by the DLQ Parent or Sister Company upon notice or within thirty (30) days’
notice of that will not expire on their own terms within thirty (30) days of the date of this Agreement;
(vii)
all Related Company Customer Contracts, separately identifying all Related Company Customer Contracts that are not cancellable or terminable
by the applicable DLQ Parent or Sister Company upon notice or within thirty (30) days’ notice or that will not expire on their own
terms within thirty (30) days of the date of this Agreement;
(viii)
all Company Customer Contracts under which the Company or one of its Subsidiaries is entitled to receive payments in excess of $50,000
per year;
(ix)
all Contracts limiting the freedom of the Company Group to compete in any line of business or industry, with any Person or in any geographic
area;
(x)
all Contracts providing for guarantees, indemnification arrangements and other hold harmless arrangements made or provided by the Company
Group other than commercial arrangements where it is not the primary purpose of the agreement;
(xi) all
Contracts with or pertaining to the Company Group to which any Affiliate of the Company Group is a party, other than any Contracts
(A) relating to such Affiliate’s status as a security holder, (B) relating to employment or service as a director or (C)
between or among members of the Company Group and its Subsidiaries;
(xii)
all Contracts relating to property or assets (whether real or personal, tangible or intangible) in which the Company Group holds a leasehold
interest (including the Lease) and which involve payments to the lessor thereunder in excess of $100,000 per year;
(xiii)
all Contracts creating or otherwise relating to outstanding Indebtedness for borrowed money or any other material Indebtedness (other
than intercompany Indebtedness);
(xiv)
all Contracts relating to the voting or control of the equity interests of the Company Group or the election of directors of the Company
Group (other than the organizational documents of the Company Group);
(xv)
all Contracts not cancellable by the Company Group with no more than sixty (60) days’ notice if the effect of such cancellation
would result in monetary penalty to the Company Group in excess of $100,000 per the terms of such contract; and
(xvi)
all collective bargaining agreements or other agreement with a labor union or labor organization.
(b)
Except as set forth on Schedule 4.15(b), each Material Contract is (i) a valid and binding agreement, (ii) in full force and
effect and (iii) enforceable by and against the applicable member of the Company Group party to such Material Contract and each counterparty
that is party thereto, subject, in the case of this clause (iii), to the Enforceability Exceptions. Neither the Company Group nor, to
the Company’s or DLQ Parent’s Knowledge, any other party to a Material Contract is in material breach or default (whether
with or without the passage of time or the giving of notice or both) under the terms of any such Material Contract. The Company Group
has not assigned, delegated or otherwise transferred any of its rights or obligations under any Material Contract or granted any power
of attorney with respect thereto.
(c)
The Company Group is in compliance in all material respects with all covenants, including all financial covenants, in all notes, indentures,
bonds and other instruments or Contracts establishing or evidencing any Indebtedness. Except as set forth on Schedule 4.10,
the consummation and closing of the transactions contemplated by this Agreement shall not cause or result in an event of default under
any instruments or Contracts establishing or evidencing any Indebtedness.
4.16 Licenses
and Permits. Schedule 4.16 sets forth a true, complete and correct list of each material license, franchise, permit,
order or approval or other similar authorization required under applicable Law to carry out the Business as currently conducted, together
with the name of the Authority issuing the same (the “Permits”). The Company Group has all such Permits, and each such
Permit is in full force and effect and none of such Permits will be terminated or materially impaired as a result of the transactions
contemplated hereby. The Company Group is not in material breach or violation of, or material default under, any such Permit, and, to
the Company’s or DLQ Parent’s Knowledge, no basis (including the execution of this Agreement and the other Additional Agreements
to which the Company Group is a party and the consummation of the transactions contemplated by this Agreement) reasonably exists which,
with notice or lapse of time or both, would reasonably constitute any such breach, violation or default or give any Authority grounds
to suspend, revoke or terminate any such Permit. The Company Group has not received any written (or, to the Company’s or DLQ Parent’s
Knowledge, oral) notice from any Authority regarding any material violation of any Permit. There has not been and there is not any pending
or, to the Company’s or DLQ Parent’s Knowledge, threatened Action, investigation or disciplinary proceeding by or from any
Authority against the Company Group involving any material Permit.
4.17 Compliance
with Laws.
(a) Except
as set forth on Schedule 4.17(a), neither the Company Group nor to the Knowledge of the Company or DLQ Parent, any Representative
or other Person acting on behalf of the Company Group in their capacity as such, is in violation in any material respect of, and, since
January 1, 2018, no such Person has failed to be in compliance with, all applicable Laws and Orders in all material respects. No Action
is pending, or to the Knowledge of the Company or DLQ Parent, threatened, alleging any such violation or noncompliance by a member of
the Company Group. Since January 1, 2018, the Company Group has not been threatened in writing or, to the Company’s or DLQ Parent’s
Knowledge, orally to be charged with, or given written or, to the Company’s or DLQ Parent’s Knowledge, oral notice of any
violation of any Law or any judgment, order or decree entered by any Authority entered against any member of the Company Group. The representations
and warranties set forth in this Section 4.17 do not apply to the representations or warranties as to compliance with Laws relating to
any matter that is the subject of another representation or warranty under this Agreement, including, without limitation, intellectual
property and data privacy matters which are addressed in Section 4.18, employment and labor matters which are addressed in Section 4.20
and 4.21, employee plans which are addressed in Section 4.22, tax matters which are addressed in Section 4.21 and 4.24, environmental
matters which are addressed in Section 4.25, and regulatory matters which are addressed in Section 4.29.
(b) Neither
the Company Group nor, to the Knowledge of the Company or DLQ Parent, any Representative or other Person acting on behalf of the Company
Group is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department.
4.18 Intellectual
Property.
(a) The
Company Group is the sole and exclusive owner of each item of Company Group Owned IP, free and clear of any Liens, excluding Permitted
Liens. To the Knowledge of the Company or DLQ Parent, the Company Group is the sole and exclusive licensee of each item of Company Group
Exclusively Licensed IP, if any, free and clear of any Liens, excluding Permitted Liens. To the Knowledge of the Company or DLQ Parent,
the Company Group has a valid right to use the Company Group Licensed IP. Collectively, the Company Group IP includes all of the Intellectual
Property that is used in, held for use in, practiced in, exploited by, or necessary to enable the Company to conduct the Business as such
Business is currently being conducted, including all of the Intellectual Property incorporated in, used in, held for use in, practiced
in, exploited by the Company Group in the Company Group Products. Immediately after the Closing, Company or its Subsidiaries will own
all right, title and interest in and to, or otherwise have a license to, all Company Group IP on identical terms and conditions as the
Company Group enjoyed immediately prior to the Closing.
(b) Schedule
4.18(b) sets forth a true, correct and complete list of all (i) Registered Owned IP; (ii) Registered Exclusively Licensed IP;
(iii) unregistered material Trademarks constituting Company Group Owned IP; (iv) Domain Names constituting Company Group Owned IP, (v)
social media handles constituting Company Group Owned IP, and (vi) all Software within the Company Group Products (at the module level),
accurately specifying as to each of the foregoing, as applicable: (A) the application number, issuance or registration number, and other
identifying details; (B) the owner and nature of the ownership; and (C) the jurisdictions by or in which such Registered Owned IP and
Registered Exclusively Licensed IP has been issued, registered, or in which an application for such issuance or registration has been
filed or for unregistered material Trademarks, used by the Company Group.
(c) Except for any Company
Group Owned IP that the Company Group may have intentionally abandoned or let expire, any Registered Owned IP set forth on Schedule
4.18(b) is subsisting and, to the Knowledge of the Company or DLQ Parent, valid and enforceable. To the Knowledge of the Company
or DLQ Parent, any Registered Exclusively Licensed IP is subsisting, valid and enforceable. To the Knowledge of the Company or DLQ Parent,
all Persons (including members of the Company Group) have, in connection with the prosecution of all Patents within the Company Group
IP before the United States Patent and Trademark Office (the “USPTO”) and, where applicable, similar offices in other
jurisdictions, complied with the applicable obligations of candor owed to the USPTO and, where applicable, such other offices. No Registered
Owned IP, and to the Knowledge of the Company or DLQ Parent no Registered Exclusively Licensed IP, is or has been involved in any interference,
opposition, reissue, reexamination, revocation or equivalent Action, and no such Action has been threatened in writing to the Company
Group with respect thereto. In the past six (6) years, not including any office actions or other responses issued by the USPTO or other
similar offices in other jurisdictions in the ordinary course of ex parte prosecution, there have been no claims filed, served or threatened
in writing, or to the Knowledge of the Company or DLQ Parent orally threatened, against the Company Group contesting the validity, use,
ownership, enforceability, patentability, registrability, or scope of any Registered IP; provided, however,
that the look back in this representation shall be limited to the past three (3) years for non-Patent Registered IP. All registration,
maintenance and renewal fees currently due in connection with any Registered Owned IP, and, to the Knowledge of the Company or DLQ Parent,
all Registered Exclusively Licensed IP, have been paid and all documents, recordations and certificates in connection therewith have
been filed with the authorities in the United States or foreign jurisdictions, as the case may be, for the purposes of prosecuting, maintaining
and perfecting such rights and recording the Company Group’s ownership or interests therein.
(d)
To the Knowledge of the Company or DLQ Parent, the operation of the Business as currently conducted and as conducted in the past six (6)
years do not conflict with, infringe, misappropriate or otherwise violate any Intellectual Property of any third Person; provided, however,
that the look back in this representation shall be limited to the past three (3) years for non-Patent Intellectual Property of any third
Person. In the past six (6) years, there have been no claims filed, served or threatened in writing, or to the Knowledge of the Company
or DLQ Parent orally threatened, against the Company Group alleging any conflict with, infringement, misappropriation, or other violation
of any Intellectual Property of a third Person (including any unsolicited written offers to license any such Intellectual Property); provided, however,
that the look back in this representation shall be limited to the past three (3) years for non-Patent Intellectual Property of any third
Person. There are no Actions pending that involve a claim against a member of the Company Group by a third Person alleging infringement
or misappropriation of such third Person’s Intellectual Property. To the Knowledge of the Company or DLQ Parent, in the past three
(3) years no third Person has conflicted with, infringed, misappropriated, or otherwise violated any Company Group Owned IP or Company
Group Exclusively Licensed IP.
(e)
In the past six (6) years no member of the Company Group has filed, served, or threatened a third Person with any claims alleging any
conflict with, infringement, misappropriation, or other violation of any Company Group IP; provided, however,
that the look back in this representation shall be limited to the past three (3) years for non-Patent Company Group IP. There are no Actions
pending that involve a claim against a third Person by a member of the Company Group alleging infringement or misappropriation of Company
Group IP. The Company Group is not subject to any Order that adversely restricts the use, transfer, registration or licensing of any such
Intellectual Property by the Company Group.
(f)
Except as disclosed on Schedule 4.18(f), each employee, agent, consultant and contractor who has contributed to or participated
in the creation or development of any Intellectual Property on behalf of the Company Group or any predecessor in interest thereto has
executed a form of proprietary information and inventions agreement or similar written Contract with the Company Group under which such
Person: (i) has assigned all right, title and interest in and to such Intellectual Property to the Company Group (or such predecessor
in interest, as applicable); and (ii) is obligated to maintain the confidentiality of the Company Group’s confidential information
both during and after the term of such Person’s employment or engagement. To the extent any such proprietary information and inventions
agreement or other similar written Contract permitted such employee, agent, consultant or contractor to exclude from the scope of such
agreement or Contract any Intellectual Property in existence prior to the date of the employment or relationship, no such employee, agent,
consultant or contractor excluded Intellectual Property that is related to the Business as currently conducted. To the Knowledge of the
Company or DLQ Parent, no employee, agent, consultant or contractor of the Company Group is or has been in violation of any term of any
such Contract.
(g)
No government funding or facility of a university, college, other educational institution or research center was used in the development
of any item of Company Group Owned IP, or to the Knowledge of the Company or DLQ Parent, Company Group Exclusively Licensed IP.
(h)
To the Knowledge of the Company or DLQ Parent, none of the execution, delivery or performance by the Company of this Agreement or any
of the Additional Agreements to which the Company or DLQ Parent is or will be a party or the consummation by the Company of the transactions
contemplated hereby or thereby will (i) cause any item of Company Group Owned IP, or any item of Company Group Licensed IP immediately
prior to the Closing, to not be owned, licensed or available for use by the Company Group on substantially the same terms and conditions
immediately following the Closing or (ii) require any additional material payment obligations by the Company Group in order to use or
exploit any other such Intellectual Property to the same extent as the Company Group was permitted immediately before the Closing.
(i)
Except as set forth on Schedule 4.18(i) and with respect to the Material Contracts listed on Schedule 4.15(a)(vi)
and excluding “off-the-shelf” Software licensed to the Company or any of its Subsidiaries pursuant to standard commercial
terms for an aggregate license fee of less than $50,000 or having an annual subscription fee of less than $25,000 and further excluding
“off-the-shelf” Software licensed to the DLQ Parent or any Sister Company pursuant to standard commercial terms and that is
not used or necessary to run or support Company Group Products, the Company Group is not obligated under any Contract to make any payments
by way of royalties, fees, or otherwise to any owner or licensor of, or other claimant to, any Intellectual Property.
(j)
No member of the Company Group (or any predecessor-in-interest) has transferred ownership of any Intellectual Property to any third Person
that was material to the Business at the time it was transferred. The Company Group has, at all times, exercised reasonable efforts necessary
to maintain, protect and enforce the secrecy, confidentiality and value of all Trade Secrets and all Software constituting Company Group
Owned IP, Company Group Exclusively Licensed IP and all other Confidential Information material to the Business, in each instance that
are at least consistent with efforts undertaken by third Persons in the industry within which the Business is a part. No Company Group
Owned IP or Company Group Exclusively Licensed IP is subject to any technology or source code escrow arrangement or obligation, and as
of the Date of this Agreement, no person other than the Company Group and their employees and contractors who are bound by confidentiality
obligations of customary scope with respect to source code has a right to access or possess any source code of the Software constituting
Company Group Owned IP or Company Group Exclusively Licensed IP or will be entitled to obtain access to or possession of such source code
as a result of the execution, delivery and performance by the Company or DLQ Parent of this Agreement. As of the Closing Date, no person
other than the Company, its Subsidiaries and their employees and contractors who are bound by confidentiality obligations of customary
scope with respect to source code has a right to access or possess any source code of the Software constituting Company Group Owned IP
or Company Group Exclusively Licensed IP or will be entitled to obtain access to or possession of such source code. Subject to Section
9.2(l)-(n) of this Agreement: (i) the Company Group is in actual possession and control of the source code of any Software constituting
Company Group Owned IP, including all Software within the Company Group Products, and all related documentation and materials, and can
compile the source code for all current Company Group Products into object code or otherwise run such Software within the Company Group
Products without error; and (ii) The Company Group maintains complete and accurate technical and descriptive materials (including all
copies in whatever form, including digital or electronic copies) relating to the acquisition, design, development, use or maintenance
of Software corresponding to the Company Group Products including all source code associated therewith, all system documentation, statements
of principles of operation, and schematics for Software associated therewith, as well as any pertinent commentary or explanation that
may be necessary to render such materials understandable and usable by a trained computer programmer.
(k)
The Company Group has a privacy policy regarding the Processing of data and Personal Information in connection with the operation of the
business as currently conducted (the “Privacy Policy”) that is made available to all visitors to the Sites prior to
or contemporaneous with the collection of any data in the possession, custody, or control, or otherwise held or Processed by, or on behalf
of the Company Group. For purposes of this subsection (k), “Sites” shall mean, any websites or applications made available
to the general public provided by or on behalf of the Company Group. The Privacy Policy accurately describes the Company Group’s
data collection, disclosure and use practices, complies with all applicable Laws and is consistent with standard industry practice.
(l) Except as set forth
on Schedule 4.18(l), in connection with its Processing of any Personal Information, the Company Group is and has been in
material compliance with all applicable Laws, including without limitation all Data Protection Laws and Laws related to data loss, theft,
and Security Breach notification obligations. To the Company’s or DLQ Parent’s Knowledge, since January 1, 2018, there have
been no Security Breaches. In addition, the Company Group has in place and since January 1, 2018 has had in place commercially reasonable
policies (including the Privacy Policy and any other internal and external privacy policies), rules, and procedures regarding the Company
Group’s collection, use, disclosure, disposal, dissemination, storage, protection and other Processing of Personal Information
as required by applicable Data Protection Laws. The Company Group has complied in all material respects with such privacy policies, rules,
and procedures in connection with any Processing by the Company Group of any Personal Information of any Person. To the Company’s
or DLQ Parent’s Knowledge, since January 1, 2018, the Company Group has not been subject to, and there are no, complaints or audits,
proceedings, investigations or claims pending against the Company Group by any Authority, or by any Person, in respect of the collection,
use, storage disclosure or other Processing of Personal Information. The Company Group (i) has implemented commercially reasonable physical,
technical, organization and administrative safeguards, including but not limited to physical security measures, policies, procedures,
standards, controls, hardware, software, firmware designed to protect the confidentiality, integrity or accessibility of information
and data, including all Personal Information of any Person accessed, Processed or maintained by the Company from Security Breaches (collectively
“Security Measures”), and (ii) where required by applicable Data Protection Laws, requires by written contract all third
party providers and other persons who have or have had access to Personal Information, or who Process Personal Information on Company
Group’s behalf, to implement industry standard security programs and policies consistent with applicable Data Protection Laws,
and that are at least as stringent as the Security Measures of the Company Group. Since January 1, 2018, to the Company’s or DLQ
Parent’s Knowledge, the Company Group has not experienced any Security Breaches of Personal Information maintained by or on behalf
of the Company Group (including by any agent, subcontractor or vendor of the Company Group). Except as set forth on Schedule
4.18(l), Company Group is and has been since January 1, 2018 in material compliance with all contractual obligations with third parties
involving Processing of any Personal Information of any Person, including but not limited to obtaining end user consent to Process such
Personal Information. Company Group’s compliance with such obligations is consistent with applicable Data Protection Law, Company
Group’s Privacy Policy and any policies regarding the Processing of Personal Information in effect. “Personal Information”
means (i) any data or information that, alone or in combination with other data or information identifies an individual natural
Person or household (including any part of such Person’s name, physical address, telephone number, email address, financial account
number or credit card number, government issued identifier (including social security number and driver’s license number), user
identification number and password, billing and transactional information, medical, health or insurance information, date of birth, educational
or employment information, vehicle identification number, IP address, cookie identifier, or any other number or identifier that identifies
or relates to an identifiable individual natural Person, or such Person’s vehicle, browser or device); or (ii) any other data or
information that constitutes personal data, personal health information, protected health information, personally identifiable information,
personal information or similar defined term under any applicable Data Protection Law.
(m)
The Software that constitutes Company Group Owned IP, including the Software within the Company Group Products and, to the Knowledge of
the Company or DLQ Parent, all other Software that is used by the Company Group, is free of all viruses, worms, Trojan horses and other
material known contaminants and does not contain any bugs, errors, or problems of a material nature that would disrupt its operation or
have an adverse impact on the operation of other Software. The Company Group Products perform in accordance with their published specifications
and any other published documentation or user materials corresponding thereto. All reported defects, warranty claims, and reports of errors
are reflected in support logs maintained in the ordinary course of business. The Company Group has not incorporated Publicly Available
Software into the Company Group’s products and services, and the Company Group has not used or distributed Publicly Available Software
as part of the Company Group’s products and services, including within any Company Group Products other than as set forth on Schedule
4.18(m). Except as set forth on Schedule 4.18(m), the Company Group has not used Publicly Available Software in a manner
that subjects, in whole or in part, any Software constituting Company Group Owned IP or any Software constituting any Company Group Product
(or portion thereof) to any Copyleft License obligations. To the Company’s or DLQ Parent’s Knowledge, the Company Group is
in material compliance with all Publicly Available Software license terms applicable to any Publicly Available Software licensed to or
used by the Company Group. The Company Group has not received any written (or, to the Knowledge of the Company or DLQ Parent, oral) notice
from any Person that it is in breach of any license with respect to Publicly Available Software.
(n)
The Company Group has implemented and maintained (or, where applicable, has required its vendors and those vendor’s subcontractors
to maintain), consistent with commercially reasonable and industry practices and in compliance in all material respects with its contractual
obligations to other Persons, reasonable security measures designed to protect, preserve and maintain the performance, security and integrity
of all computers, servers, equipment, hardware, networks, Software and systems used, owned, leased or licensed by the Company Group in
connection with the operation of the Business as currently conducted (the “Company Group Information Systems”). To
the Company’s or DLQ Parent’s Knowledge, there has been no unauthorized access to or use of the Company Group Information
Systems nor has there been, in the past twenty-four (24) months, any downtime or unavailability of the Company Group Information Systems
that resulted in a material disruption of the Business. The Company Group Information Systems that are owned, leased or licensed by Company
or its Subsidiaries are adequate and sufficient (including with respect to working condition and capacity) for the operations of the Business
as currently conducted, are in good repair and operating condition, are free from any material defects, and do not contain any virus,
Software or hardware component designed to permit unauthorized access or to disable or otherwise harm or disable any such computer, server,
equipment, hardware, networks, Software or systems whether automatically with the passage of time or under the positive control of a Person.
There has been no failure with respect to any Company Group Information System that has had a material adverse effect on the operations
of the Company Group.
(o) Schedule
4.18(o): (i) identifies each standards-setting organization (including ETSI, 3GPP, 3GPP2, TIA, IEEE, IETF, and ITU-R), university
or industry body, consortium, other multi-party special interest group and any other collaborative or other group in which the Company
Group is currently participating, or has participated in the past or applied for future participation in (including any of the foregoing
that may be organized, funded, sponsored, formed or operated, in whole or in part, by any Authority), in all cases, to the extent related
to any Intellectual Property (each a “Standards Setting Body”); and (ii) sets forth a listing of the membership agreements
and other Contracts relating to such Standards Bodies, to which Company Group is bound (collectively, “Standards Setting Agreements”).
True, complete and correct copies of all Standards Setting Agreements have been delivered to Parent. The Company Group is not bound by,
and has not agreed in writing to be bound by, any Contract (including any written licensing commitment), bylaw, policy, or rule of any
Standards Setting Body that requires or purports to require the Company Group to contribute, disclose or license any Intellectual Property
to such Standards Setting Body or its other members, other than the Standards Setting Agreements. The Company Group has not made any written
Patent disclosures to any Standards Setting Body. The Company Group is in material compliance with all Standards Setting Agreements that
relate to Intellectual Property Rights. The Company Group is not engaged in any material dispute with any Standards Setting Body with
respect to any Intellectual Property Rights or with any third Persons with respect to Company Group’s conduct with respect to any
Standards Setting Body.
4.19 Accounts
Payable; Affiliate Loans.
(a) Schedule
4.19(a) sets forth a breakdown and aging of the Company Group’s accounts payable (including to all of its suppliers) as
of five (5) days prior to the date hereof. Such accounts payable arose from bona fide transactions in the ordinary course consistent with
past practice.
(b)
The information set forth on Schedule 4.19(b) separately identifies any and all accounts, receivables or notes of the
Company Group which are owed by any Affiliate of the Company Group (excluding another member of the Company Group). Except as set forth
on Schedule 4.19(b), the Company Group does not owe any Indebtedness to any of its Affiliates and no Affiliates owe any Indebtedness
to the Company Group (excluding any Indebtedness among the Company and its Subsidiaries).
4.20 Employees;
Employment Matters.
(a) Schedule
4.20(a) sets forth a true, correct and complete list of each of the five highest compensated officers or employees of the Company
Group as of the date hereof, setting forth the name, title, current base salary or hourly rate for each such person and total compensation
(including bonuses and commissions) paid to each such person for the fiscal years ended December 31, 2021 and 2020.
(b)
The Company Group is not a party to any collective bargaining agreement, and since January 1, 2018, there has been no activity or proceeding
by a labor union or representative thereof to organize any employees of the Company Group. There is no labor strike, material slowdown
or material work stoppage or lockout pending or, to the Knowledge of the Company or DLQ Parent, threatened against the Company Group,
and, since January 1, 2018, the Company Group has not experienced any strike, material slowdown, material work stoppage or lockout by
or with respect to its employees. To the Knowledge of the Company or DLQ Parent, the Company Group is not subject to any attempt by any
union to represent Company Group employees as a collective bargaining agent.
(c)
There are no pending or, to the Knowledge of the Company or DLQ Parent, threatened material Actions against the Company Group under any
worker’s compensation policy or long-term disability policy. There is no material unfair labor practice charge or complaint pending
or, to the Knowledge of the Company or DLQ Parent, threatened before any applicable Authority relating to employees of the Company Group.
Except as set forth on Schedule 4.20(c), since January 1, 2018, the Company Group has not engaged in, and is not currently
contemplating, any location closing, employee layoff, or relocation activities that would reasonably be expected to trigger the Worker
Adjustment Retraining and Notification Act of 1988, as amended, or any similar state or local statute, rule or regulation.
(d) Except as set forth
on Schedule 4.20(d), the Company Group is, and since January 1, 2018 has been, in material compliance in all material respects
with all applicable Laws relating to employment of labor, including all applicable Laws relating to wages, hours, overtime, collective
bargaining, equal employment opportunity, anti-discrimination, anti-harassment (including, but not limited to sexual harassment), anti-retaliation,
immigration, leaves, disability rights or benefits, employment and reemployment rights of members and veterans of the uniformed services,
paid time off/vacation, unemployment insurance, safety and health, workers’ compensation, pay equity, restrictive covenants, child
labor, whistleblower rights, classification of employees and independent contractors, meal and rest breaks, business expenses, and the
collection and payment of withholding or social security Taxes. Since January 1, 2018, no audits have been conducted, or are currently
being conducted, or, to the Knowledge of the Company or DLQ Parent, are threatened to be conducted by any Authority with respect to applicable
Laws regarding employment or labor Laws. The Company Group has complied, in all material respects, with all Laws relating to the
verification of identity and employment authorization of individuals employed in the United States, and to the Knowledge of the Company
and DLQ Parent, no member of the Company Group currently employs, or since January 1, 2018 has employed, any Person who was not permitted
to work in the jurisdiction in which such Person was employed. No audit by any Authority is currently being conducted, pending or, to
the Knowledge of the Company or DLQ Parent, threatened to be conducted in respect to any foreign workers employed by the Company Group.
Except as set forth on Schedule 4.14, no employee of the Company Group has, since January 1, 2018, brought or, to the Knowledge
of the Company or DLQ Parent, threatened to bring a claim that remains pending for unpaid compensation, including overtime amounts.
(e)
To the Knowledge of the Company or DLQ Parent, no key employee or officer of the Company Group is a party to or is bound by any non-competition
agreement (with any Person) that would materially interfere with the performance by such officer or key employee of any of his or her
duties or responsibilities as an officer or employee of the Company Group. To the Knowledge of the Company or DLQ Parent, no key employee
or officer of the Company Group has given written notice of their definite intent to terminate their employment with the Company Group,
nor does the Company Group have any present intention to terminate the employment of any of the foregoing.
(f)
Except as set forth on Schedule 4.20(f), the employment of each of the key employees is terminable at will without any penalty
or severance obligation on the part of the Company Group. All material sums due for employee compensation and all vacation time owing
to any employees of the Company Group, and all fees owing to any independent contractors and consultants, have been duly accrued on the
accounting records of the Company Group.
(g)
Except as set forth on Schedule 4.20(g), each individual engaged by the Company Group as an independent contractor or consultant
is, and since January 1, 2018 has been, properly classified by the Company Group as an independent contractor, and the Company Group has
not received any written notice from any Authority or Person disputing such classification.
(h)
Except as set forth on Schedule 4.20(h) and as set forth on Schedule 4.14, there is no, and since January
1, 2018 there has been no, written notice provided to the Company Group of any pending or, to the Knowledge of the Company or DLQ Parent,
threatened claim or litigation relating to, or any written complaint or allegation of, discrimination, retaliation, wrongful termination,
constructive termination, harassment (including sexual harassment), sexual misconduct, or wage and hour violation against the Company
Group that remains pending; nor there is any pending obligation for the Company Group under any settlement or out-of-court or pre-litigation
arrangement relating to such matters.
(i)
To the Knowledge of the Company or DLQ Parent, except as set forth on Schedule 4.20(i), since January 1, 2018, the Company
Group has investigated all workplace harassment (including sexual harassment), discrimination, retaliation, and workplace violence written
claims relating to current and/or former employees of the Company Group or third-parties who interacted with current and/or former employees
of the Company Group. With respect to each such written claim with potential merit, the Company Group has taken corrective action. Further,
to the Knowledge of the Company or DLQ Parent, since January 1, 2018 no allegations of sexual harassment have been made to the Company
Group against any individual in his or her capacity as director or an executive officer of the Company Group.
(j)
The Company Group has complied in all material respects with all applicable Laws regarding the COVID-19 pandemic, including all applicable
federal, state and local Orders issued by any Authority (whether in the United States or any other jurisdiction) regarding shelters-in-place,
or similar Orders in effect as of the date hereof and have taken appropriate precautions regarding its employees. The Company Group has
promptly and thoroughly investigated all occupational safety and health complaints, issues, or inquiries related to the COVID-19 pandemic.
With respect to each material occupational safety and health complaint, issue, or inquiry related to the COVID-19 pandemic, the Company
Group has taken prompt corrective action that is reasonably calculated to prevent the spread of COVID-19 within the Company Group’s
workplace.
(k)
As of the date hereof and since January 1, 2018, there have been no material audits by any Authority, nor have there been any charges,
fines, or penalties, including, to the Knowledge of the Company and DLQ Parent, those pending or threatened, under any applicable federal,
state or local occupational safety and health Law and Orders (collectively, “OSHA”) against the Company Group. The
Company Group is in compliance in all material respects with OSHA and there are no pending appeals of any Authority’s decision or
fines issued in relation to OSHA.
(l)
Except as set forth on Schedule 4.20(l), the Company Group has not paid or promised to pay any bonus to any employee in connection
with the consummation of the transactions contemplated hereby.
4.21 Withholding.
Except as disclosed on Schedule 4.21, all obligations of the Company Group applicable to its employees, whether arising
by operation of Law, by Contract, or attributable to payments by the Company Group to trusts or other funds or to any Authority, with
respect to unemployment compensation benefits or social security benefits for its employees through the date hereof, have been paid or
adequate accruals therefor have been made on the Company Group financial statements. Except as disclosed on Schedule 4.21,
all reasonably anticipated material obligations of the Company Group with respect to such employees (except for those related to wages
during the pay period immediately prior to the Closing Date and arising in the ordinary course of business consistent with past practices),
whether arising by operation of Law, by contract, by past custom, or otherwise, for salaries and holiday pay, bonuses and other forms
of compensation payable to such employees in respect of the services rendered by any of them prior to the date hereof have been or will
be paid by the Company Group prior to the Closing Date.
4.22 Employee
Benefits.
(a) Schedule
4.22(a) sets forth a correct and complete list of all Plans. With respect to each Plan, the Company Group has made available
to Parent or its counsel a true and complete copy, to the extent applicable, of: (i) each writing constituting a part of such Plan and
all amendments thereto, including all plan documents, benefit schedules, trust agreements, and insurance contracts and other funding vehicles;
(ii) the most recent annual reports on Form 5500 and accompanying schedules; (iii) the current summary plan description and any material
modifications thereto; (iv) the most recent annual financial and actuarial reports; and (v) the most recent determination or advisory
letter received by the Company Group from the Internal Revenue Service regarding the tax-qualified status of such Plan.
(b)
Except as set forth on Schedule 4.22(b), no Plan is (i) subject to Title IV or Section 302 of ERISA or Section 412 or 4971
of the Code or (ii) a “multiemployer plan” (as defined in Section 3(37) of ERISA). None of the Company Group, or any ERISA
Affiliate, has withdrawn at any time since January 1, 2018 from any multiemployer plan or incurred any withdrawal liability which remains
unsatisfied, and no events have occurred and, to the Knowledge of the Company or DLQ Parent, no circumstances exist that could reasonably
be expected to result in any such liability to the Company Group.
(c)
With respect to each Plan that is intended to qualify under Section 401(a) of the Code, such Plan, including its related trust, has received
a determination letter (or may rely upon opinion letters in the case of any prototype plans) from the Internal Revenue Service that it
is so qualified and that its trust is exempt from Tax under Section 501(a) of the Code, and, to the Knowledge of the Company or DLQ Parent,
nothing has occurred with respect to the operation of any such Plan that could cause the loss of such qualification or exemption.
(d)
There are no pending or, to the Knowledge of the Company or DLQ Parent, threatened Actions against or relating to the Plans, the assets
of any of the trusts under such Plans or the Plan sponsor or the Plan administrator, or against any fiduciary of any Plan with respect
to the operation of such Plan (other than routine benefits claims). No Plan is presently under audit or examination (nor has written notice
been received of a potential audit or examination) by any Authority.
(e)
Each Plan has been established, administered and funded in accordance with its terms and in compliance in all material respects with the
applicable provisions of ERISA, the Code and other applicable Laws. All premiums due or payable with respect to insurance policies funding
any Plan have been made or paid in full or, to the extent not required to be made or paid on or before the date hereof, have been fully
reflected on the Company Group financial statements.
(f)
None of the Plans provide retiree health or life insurance benefits, except as may be required by Section 4980B of the Code, Section 601
of ERISA or any other applicable Law.
(g)
Except as set forth on Schedule 4.22(g), neither the execution and delivery of this Agreement nor the consummation of the
transactions contemplated hereby will (either alone or in combination with another event) (i) result in any payment becoming due, or increase
the amount of any compensation or benefits due, to any current or former employee of the Company Group and its Subsidiaries or with respect
to any Plan; (ii) increase any benefits otherwise payable under any Plan; (iii) result in the acceleration of the time of payment or vesting
of any such compensation or benefits. No Person is entitled to receive any additional payment (including any tax gross-up or other payment)
from the Company Group as a result of the imposition of the excise taxes required by Section 4999 of the Code or any taxes required by
Section 409A of the Code.
(h)
Except as set forth on Schedule 4.22(h), neither the execution and delivery of this Agreement nor the consummation of the
transactions contemplated hereby will (either alone or in combination with another event) result in the payment of any amount that would,
individually or in combination with any other such payment, be an “excess parachute payment” within the meaning of Section
280G of the Code.
(i)
Each Plan that is a “nonqualified deferred compensation plan” (as defined in Section 409A(d)(1) of the Code) is in documentary
compliance with, and has been administered in compliance with Section 409A of the Code.
(j)
All Plans subject to the laws of any jurisdiction outside of the United States (i) if they are intended to qualify for special tax treatment,
meet all material requirements for such treatment, and (ii) if they are intended to be funded and/or book-reserved, are fully funded and/or
book reserved, as appropriate, based upon reasonable actuarial assumptions.
4.23 Real
Property.
(a)
Except as set forth on Schedule 4.23, the Company Group does not own, or otherwise have an interest in, any Real Property,
including under any Real Property lease, sublease, space sharing, license or other occupancy agreement. The Leases are the only Contract
pursuant to which the Company Group leases any real property or right in any Real Property. The Company Group has good, valid and subsisting
title to its respective leasehold estates in the offices described on Schedule 4.23, free and clear of all Liens other than
Permitted Liens and except as set forth on Schedule 4.13(b). The Company Group has not breached or violated any local zoning
ordinance, and no notice from any Person has been received by the Company Group or served upon the Company Group claiming any violation
of any local zoning ordinance. The Company Group has delivered to Parent a true and complete copy of each Lease.
(b)
With respect to each Lease: (i) it is valid, binding and in full force and effect, subject to the Enforceability Exceptions; (ii) all
rents and additional rents and other sums, expenses and charges due thereunder have been paid; (iii) the Company Group has been in peaceable
possession of the premises leased thereunder since the commencement of the original term thereof; (iv) no waiver, indulgence or postponement
of the Company Group’s obligations thereunder has been granted by the lessor; (v) there exist no material default or event of default
thereunder by the Company Group or, to the Company’s or DLQ Parent’s Knowledge, by any other party thereto; (vi) there exists,
to the Company’s or DLQ Parent’s Knowledge, no occurrence, condition or act which, with the giving of notice, the lapse of
time or the happening of any further event or condition, would reasonably be expected to become a material default or event of default
by the Company Group thereunder; (vii) there are no outstanding claims of breach or indemnification or notice of default or termination
thereunder, (viii) except as set forth on Schedule 4.23, the Company Group has not subleased, assigned or otherwise granted
to any Person the right to use or occupy such leased Real Property or any portion thereof, and (ix) except as set forth on Schedule
4.8, the transactions contemplated hereunder do not require the consent of, or notice to, the landlord to such Lease, will not result
in a breach of or default under such Lease, or otherwise cause such Lease to cease to be legal, valid, binding, enforceable and in full
force and effect on identical terms following the Closing. Except as set forth on Schedule 4.13(b), the Company Group holds
each leasehold estate established under each Lease free and clear of all Liens, except for Liens of mortgagees of the Real Property on
which such leasehold estate is located.
4.24 Tax
Matters. Except as set forth on Schedule 4.24:
(a) (i) There is no Action,
pending or proposed in writing, with respect to Taxes of the Company Group; (ii) no statute of limitations in respect of the assessment
or collection of any Taxes of the Company Group for which a Lien may be imposed on any of the Company Group’s assets has been waived
or extended, which waiver or extension is in effect; (iii) there is no outstanding request for a ruling from any Taxing Authority, request
for consent by a Taxing Authority for a change in a method of accounting, subpoena or request for information by any Taxing Authority
or agreement with any Taxing Authority with respect to the Company Group; (iv) there is no Lien (other than Permitted Liens) for Taxes
upon any of the assets of the Company Group; (v) no written claim has ever been made by a Taxing Authority in a jurisdiction where the
Company Group has not paid any Tax or filed Tax Returns, asserting that the Company Group is or may be subject to Tax in such jurisdiction,
the Company Group is not nor has it ever been subject to Tax in any country other than the respective countries of incorporation or formation
of the Company Group members by virtue of having a permanent establishment or other place of business in that country, and the members
of the Company Group are and have always been tax residents solely in their respective countries of incorporation or formation; (vi)
no member of the Company Group is, nor has ever been, a party to any Tax sharing, Tax indemnity or Tax allocation Contract; (vii) no
member of the Company Group has been a member of an “affiliated group” within the meaning of Section 1504(a) of the Code
filing a consolidated federal income Tax Return (other than a group the common parent of which was DLQ Parent); (viii) the Company Group
has no liability for the Taxes of any other Person: (1) under Treasury Regulation Section 1.1502-6 (or any similar provision of applicable
Law), (2) as a transferee or successor or by contract or (3) otherwise by operation of applicable Law; (ix) to the Knowledge of the Company
or DLQ Parent, no issue has been raised in writing by a Taxing Authority in any prior Action relating to the Company Group with respect
to any Tax for any period which, by application of the same or similar principles, could reasonably be expected to result in a proposed
Tax deficiency of the Company Group for any other period; (x) the Company Group has not requested any extension of time within which
to file any Tax Return, which Tax Return has since not been filed; (xi) no member of the Company Group is a “United States real
property holding corporation” within the meaning of Section 897(c)(2) of the Code during the applicable period specified in Section
897(c)(1)(A)(ii) of the Code; and (xii) no member of the Company Group has disclosed on its Tax Returns any Tax reporting position
taken in any Tax Return which could result in the imposition of penalties under Section 6662 of the Code (or any comparable provisions
of state, local or foreign Law) and no member of the Company Group has been a party to any “reportable transaction” or “listed
transaction” as defined in Section 6707A(c) of the Code and Treasury Regulation Section 1.6011-4(b).
(b)
The Company Group will not be required to include any item of income or exclude any item of deduction for any taxable period ending after
the Closing Date as a result of: (i) the use of, or change in, a method of accounting with respect to any transaction that occurred on
or before the Closing Date; (ii) any closing agreement described in Section 7121 of the Code (or similar provision of state, local or
foreign Law); (iii) any installment sale or open sale transaction disposition made in a pre-Closing Tax period; (iv) any prepaid amount
received in a pre-Closing Tax period; or (v) any intercompany transaction or excess loss account described in Treasury Regulations under
Section 1502 of the Code (or any corresponding or similar provision of state, local or non-U.S. income Tax law.
(c)
The Company Group has been in compliance in all respects with all applicable transfer pricing laws and legal requirements.
(d)
Neither the Company nor DLQ Parent is aware of any fact or circumstance that would reasonably be expected to prevent the Merger from qualifying
as a “reorganization” within the meaning of Section 368(a) of the Code.
(e)
The Company Group has not deferred the withholding or remittance of any Applicable Taxes related or attributable to any Applicable Wages
for any employees of the Company Group and shall not defer the withholding or remittance any Applicable Taxes related or attributable
to Applicable Wages for any employees of the Company Group up to and through and including Closing Date, notwithstanding IRS Notice 2020-65
(or any comparable regime for state or local Tax purposes).
4.25 Environmental
Laws. To the Knowledge of the company and the DLQ Parent, the Company Group has complied and is in compliance with all Environmental
Laws in all material respects, and there are no Actions pending or, to the Knowledge of the Company or DLQ Parent, threatened against
the Company Group alleging any failure to so comply. The Company Group has not (a) received any written notice of any alleged claim,
violation of or liability under any Environmental Law nor any written claim of potential liability with regard to any Hazardous Material,
which has not heretofore been cured or for which there is any remaining liability; (ii) disposed of, emitted, discharged, handled, stored,
transported, used or released any Hazardous Material; arranged for the disposal, discharge, storage or release of any Hazardous Material;
or exposed any employee or other individual or property to any Hazardous Material so as to give rise to any liability or corrective or
remedial obligation under any Environmental Laws; or (iii) entered into any agreement that may require it to guarantee, reimburse,
pledge, defend, hold harmless or indemnify any other Person with respect to liabilities arising out of Environmental Laws or the Hazardous
Material Activity. To the Knowledge of the company and the DLQ Parent, there are no Hazardous Materials in, on or under any properties
owned, leased or used at any time by the Company Group that would reasonably be expected to give rise to any liability or corrective
or remedial obligation of the Company Group under any Environmental Laws.
4.26 Finders’
Fees. Except as set forth on Schedule 4.26, there is no investment banker, broker, finder or other intermediary which
has been retained by or is authorized to act on behalf of the Company Group or any of its Affiliates who would reasonably be entitled
to any fee or commission from any member of the Company Group, DLQ Parent, Merger Sub, Parent or any of their Affiliates upon consummation
of the transactions contemplated by this Agreement.
4.27 Powers
of Attorney, Suretyships and Bank Accounts. The Company Group does not have any general or special powers of attorney outstanding
(whether as grantor or grantee thereof) or any obligation or liability (whether actual, accrued, accruing, contingent or otherwise) as
guarantor, surety, co-signer, endorser, co-maker, indemnitor or otherwise in respect of the obligation of any Person.
4.28 Directors
and Officers. Schedule 4.28 sets forth a true, correct and complete list of all directors and officers of the Company
Group.
4.29 Anti-Money
Laundering Laws.
(a)
The Company Group currently is and, since January 1, 2018 has been, in compliance in all material respects with applicable Laws related
to anti-corruption or anti-bribery, including the U.S. Foreign Corrupt Practices Act of 1977 (the “Foreign Corrupt Practices
Act”), 15 U.S.C. §§ 78dd-1, et seq., and any other equivalent or comparable Laws of other countries (collectively,
“Anti-Corruption Laws”). In addition, to the Knowledge of the Company Group and DLQ Parent, the Company Group currently
is and, since January 1, 2018 has been, in compliance in all material respects with applicable Laws related to (i) economic sanctions
administered, enacted or enforced by any Authority (collectively, “Sanctions Laws”), (ii) export controls, including
the U.S. Export Administration Regulations, 15 C.F.R. §§ 730, et seq., and any other equivalent or comparable Laws of other
countries (collectively, “Export Control Laws”), (iii) anti-money laundering, including the Money Laundering Control
Act of 1986, 18 U.S.C. §§ 1956, 1957, and any other equivalent or comparable Laws of other countries; (v) anti-boycott regulations,
as administered by the U.S. Department of Commerce; and (v) importation of goods, including Laws administered by the U.S. Customs and
Border Protection, Title 19 of the U.S.C. and C.F.R., and any other equivalent or comparable Laws of other countries (collectively, “International
Trade Control Laws”).
(b)
Neither the Company Group nor, to the Knowledge of the Company or DLQ Parent, any Representative of the Company Group (acting on behalf
of the Company Group), is or is acting under the direction of, on behalf of or for the benefit of a Person that is, (i) the subject of
Sanctions Laws or identified on any sanctions or similar lists administered by an Authority, including the U.S. Department of the Treasury’s
Specially Designated Nationals List, the U.S. Department of Commerce’s Denied Persons List and Entity List, the U.S. Department
of State’s Debarred List, HM Treasury’s Consolidated List of Financial Sanctions Targets and the Investment Bank List, or
any similar list enforced by any other relevant Authority, as amended from time to time, or any Person owned or controlled by any of the
foregoing (collectively, “Prohibited Party”); (ii) the target of any Sanctions Laws; (iii) located, organized or resident
in a country or territory that is, or whose government is, the target of comprehensive trade sanctions under Sanctions Laws, including,
as of the date of this Agreement, Crimea, Cuba, Iran, North Korea, Sudan and Syria; or (iv) an officer or employee of any Authority or
public international organization, or officer of a political party or candidate for political office. Neither the Company Group nor, to
the Knowledge of the Company or DLQ Parent, any Representative of the Company Group (acting on behalf of the Company Group), to the Knowledge
of the Company or DLQ Parent, (A) has participated in any transaction involving a Prohibited Party, or a Person who is the target of any
Sanctions Laws, or any country or territory that was during such period or is, or whose government was during such period or is, the target
of comprehensive trade sanctions under Sanctions Laws, (B) has exported (including deemed exportation) or re-exported, directly or indirectly,
any commodity, software, technology, or services in violation of any applicable Export Control Laws or (C) has participated in any transaction
in violation of or connected with any purpose prohibited by Anti-Corruption Laws or any applicable International Trade Control Laws, including
support for international terrorism and nuclear, chemical, or biological weapons proliferation.
(c)
No member of the Company Group, has received written notice of, nor, to the Knowledge of the Company or DLQ Parent, any of its Representatives
is or has been the subject of, any investigation, inquiry or enforcement proceedings by any Authority regarding any offense or alleged
offense under Anti-Corruption Laws, Sanctions Laws, Export Control Laws or International Trade Control Laws (including by virtue of having
made any disclosure relating to any offense or alleged offense) and, to the Knowledge of the Company or DLQ Parent, there are no circumstances
likely to give rise to any such investigation, inquiry or proceeding.
4.30 Insurance.
All material insurance policies owned or held by and insuring the Company Group are set forth on Schedule 4.30, and such policies
are in full force and effect. All premiums with respect to such policies covering all periods up to and including the Closing Date have
been or will be paid when due, no notice of cancellation or termination has been received with respect to any such policy which was not
replaced on substantially similar terms prior to the date of such cancellation or termination and there is no claim by the Company Group
or, to the Company’s or DLQ Parent’s Knowledge, any other Person pending under any of such insurance policies as to which
coverage has been denied by the underwriters or issuers of such policies. There is no existing default or event which, with or without
the passage of time or the giving of notice or both, would constitute noncompliance with, or a default under, any such policy or entitle
any insurer to terminate or cancel any such policy. Such policies will not in any way be affected by or terminate or lapse by reason of
the transactions contemplated by this Agreement or the Additional Agreements. The insurance policies to which the Company Group is a party
are sufficient for compliance with all requirements of all Material Contracts to which the Company Group is a party or by which the Company
Group is bound. Since January 1, 2018, the Company Group has not been refused any insurance with respect to its assets or operations or
had its coverage limited by any insurance carrier to which it has applied for any such insurance or with which it has carried insurance.
The Company Group does not have any self-insurance arrangements. No fidelity bonds, letters of credit, performance bonds or bid bonds
have been issued to or in respect of the Company Group.
4.31 Related
Party Transactions. Except as set forth in Schedule 4.31, as contemplated by this Agreement or as provided in the Company
Group Financial Statements to be delivered pursuant to Section 7.4 hereof, no Affiliate of the Company Group, current or former director,
manager or officer of any Person in the Company Group or any immediate family member or Affiliate of any of the foregoing (a) is a party
to any Contract, or has otherwise entered into any transaction, understanding or arrangement, with the Company Group (in each case, excluding
any employment or service agreements as an employee or director of the Company Group), (b) owns any asset, property or right, tangible
or intangible, which is used by the Company Group, or (c) is a borrower or lender, as applicable, under any Indebtedness owed by or to
the Company Group.
4.32 No
Trading or Short Position. None of the Company, DLQ Parent, any other member of the Company Group, or any of their respective managers
and officers, members and employees has engaged in any short sale of Parent’s voting stock or any other type of hedging transaction
involving Parent’s securities (including, without limitation, depositing shares of Parent’s securities with a brokerage firm
where such securities are made available by the broker to other customers of the firm for purposes of hedging or short selling Parent’s
securities).
4.33 Not
an Investment Company. Neither the Company nor any other member of the Company Group is an “investment company” within
the meaning of the Investment Company Act of 1940, as amended, and the rules and regulations promulgated thereunder.
4.34 Information
Supplied None of the information supplied or to be supplied by the Company Group expressly for inclusion or incorporation by
reference in the Form S-4 or the Proxy Statement, as applicable, and mailings to Parent’s stockholders with respect to the solicitation
of proxies to approve the transactions contemplated by this Agreement and the Additional Agreements, if applicable, will, when filed,
made available, mailed or distributed, as the case may be, contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they
are made, not misleading (subject to the qualifications and limitations set forth in the materials provided by the Company Group or included
in the Parent SEC Documents, the Additional Parent SEC Documents, the SEC Statement or any Other Filing). This Section 4.34 does not address
projections and other forward-looking information, as to which no representations are provided herein.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB
Except
as disclosed in the Parent SEC Documents filed with or furnished to the SEC in unredacted form no later than the second day prior to the
date of this Agreement and available to public access through the EDGAR database (other than any risk factor disclosures or other similar
cautionary or predictive statements therein) (and to the extent the qualifying nature of such disclosure is reasonably apparent on its
face); provided that nothing disclosed in any such Parent SEC Document will be deemed to modify or qualify the representations and warranties
set forth in Section 5.1 (Corporate Existence and Power), Section 5.2 (Corporate Authorization) and Section
5.7 (Capitalization)), Parent and Merger Sub (the “Parent Parties”) hereby represent and warrant to the Company
that each of the following representations and warranties are true, correct and complete as of the date of this Agreement and as of the
Closing Date:
5.1 Corporate
Existence and Power. Each Parent Party is a corporation duly incorporated, validly existing and in good standing under the laws of
the State of Delaware. Each Parent Party has all requisite power and authority, corporate and otherwise, to own, lease or otherwise hold
and operate its properties and other assets and to carry on its business as currently conducted. Each Parent Party is duly licensed or
qualified to do business and is in good standing (with respect to jurisdictions that recognize that concept) in each jurisdiction in which
the nature of its business or the ownership, leasing or operation of its properties or other assets makes such qualification, licensing
or good standing necessary, except where the failure to be so qualified, licensed or in good standing, individually or in the aggregate,
has not had and would not reasonably be expected to have a Material Adverse Effect in respect of the Parent Parties. Since their respective
dates of organization, the Parent Parties have not conducted any business activities other than activities directed toward the accomplishment
of a business combination. Except as set forth in their Organizational Documents, there is no agreement, exclusive license or Order binding
upon a Parent Party or to which any Parent Party is a party that prohibits or materially restricts any business practice of the Parent
Parties, any acquisition of property by the Parent Parties, or the conduct of business by the Parent Parties. Merger Sub does not hold
and has not held any material assets or incurred any material liabilities and has not carried on any business activities other than in
connection with the Merger.
5.2 Corporate
Authorization. Each of the Parent Parties has all requisite corporate power and authority to execute and deliver this Agreement and
the Additional Agreements to which it is a party and to consummate the transactions contemplated hereby and thereby, in the case of the
Merger, subject to receipt of the Parent Stockholder Approval. The execution and delivery by each of the Parent Parties of this Agreement
and the Additional Agreements to which it is a party and the consummation by each of the Parent Parties of the transactions contemplated
hereby and thereby have been duly authorized by all necessary corporate action on the part of such Parent Party. No other corporate proceedings
on the part of such Parent Party are necessary to authorize this Agreement or the Additional Agreements to which it is a party or to consummate
the transactions contemplated by this Agreement (other than, in the case of the Merger, the receipt of the Parent Stockholder Approval)
or the Additional Agreements. This Agreement and the Additional Agreements to which such Parent Party is a party have been duly executed
and delivered by such Parent Party and, assuming the due authorization, execution and delivery by each of the other parties hereto and
thereto (other than a Parent Party), this Agreement and the Additional Agreements to which such Parent Party is a party constitute a legal,
valid and binding obligation of such Parent Party, enforceable against such Parent Party in accordance with their respective terms, subject
to the Enforceability Exceptions. The affirmative vote of holders of a majority of the then outstanding shares of Parent Common Stock
present in person or by proxy and entitled to vote at the Parent Stockholder Meeting, assuming a quorum is present (the “Parent
Stockholder Approval”), is the only vote of the holders of any of Parent’s capital stock necessary to adopt this Agreement
and approve the Merger and the consummation of the other transactions contemplated hereby. The affirmative vote or written consent of
the sole stockholder of the Merger Sub is the only vote of the holders of any of Merger Sub’s capital stock necessary to adopt this
Agreement and approve the Merger and the consummation of the other transactions contemplated hereby.
5.3 Governmental
Authorization. Assuming the accuracy of the representations and warranties of the Company and DLQ Parent set forth in Section
4.3, none of the execution, delivery or performance of this Agreement or any Additional Agreement by a Parent Party or the consummation
by a Parent Party of the transactions contemplated hereby and thereby requires any consent, approval, license or other action by or in
respect of, or registration, declaration, notification or filing with any Authority except for the filing of the Certificates of Merger
with the Secretaries of State of the State of Delaware and Nevada pursuant to the DGCL and the NRS.
5.4 Non-Contravention.
The execution, delivery and performance by a Parent Party of this Agreement or the consummation by a Parent Party of the transactions
contemplated hereby and thereby do not and will not (a) contravene or conflict with the organizational or constitutive documents of the
Parent Parties, or (b) contravene or conflict with or constitute a violation of any provision of any Law or any Order binding upon or
applicable to the Parent Parties or to any of their respective properties, rights or assets, (c) (i) require consent, approval or waiver
under, (ii) constitute a default under or breach of (with or without the giving of notice or the passage of time or both), (iii) violate,
(iv) give rise to any right of termination, cancellation, amendment or acceleration of any right or obligation of a Parent Party or to
a loss of any material benefit to which any Parent Party is entitled, in the case of each of clauses (i) – (iv), under any provision
of any Permit, Contract or other instrument or obligations binding upon any Parent Party or any of their respective properties, rights
or assets, (d) result in the creation or imposition of any Lien (except for Permitted Liens) on any of a Parent Party’s properties,
rights or assets, or (e) require any consent, approval or waiver from any Person pursuant to any provision of the amended and restated
certificate of incorporation of Parent or bylaws of the Parent or the organizational or constitutive documents of any other Parent Party,
except for such consent, approval or waiver which shall be obtained (and a copy provided to the Company) prior to the Closing.
5.5 Finders’
Fees. There is no investment banker, broker, finder or other intermediary which has been retained by or is authorized to act on behalf
of the Parent Parties or their Affiliates who might be entitled to any fee or commission from the Company or any of its Affiliates upon
consummation of the transactions contemplated by this Agreement or any of the Additional Agreements.
5.6 Issuance
of Shares. The Merger Consideration Shares, when issued in accordance with this Agreement, will be duly authorized and validly issued,
and will be fully paid and nonassessable.
5.7 Capitalization.
(a)
The authorized capital stock of Parent consists of 100,000,000 shares of Parent Common Stock, and 1,000,000 shares of preferred stock,
par value $0.0001 per share (“Parent Preferred Stock”) of which 7,461,998 shares of Parent Common Stock (inclusive
of Parent Common Stock included in any outstanding Parent Units), and no shares of Parent Preferred Stock are issued and outstanding.
In addition, 6,028,518 Parent Warrants (inclusive of Parent Warrants included in any outstanding Parent Units and the Parent Private Warrants)
exercisable for 6,028,518 shares of Parent Common Stock are issued and outstanding at an exercise price of $11.50 per share. No other
shares of capital stock or other voting securities of Parent are issued, reserved for issuance or outstanding. All issued and outstanding
shares of Parent Common Stock are duly authorized, validly issued, fully paid and nonassessable and are not subject to, and were not issued
in violation of, any purchase option, right of first refusal, preemptive right, subscription right or any similar right under any provision
of the DGCL, Parent’s organizational documents or any contract to which Parent is a party or by which Parent is bound. Except as
set forth in Parent’s organizational documents, there are no outstanding contractual obligations of Parent to repurchase, redeem
or otherwise acquire any shares of Parent Common Stock or any capital equity of Parent or any securities convertible into or exchangeable
for any shares of capital stock of Parent. There are no outstanding contractual obligations of Parent to provide funds to, or make any
investment (in the form of a loan, capital contribution or otherwise) in, any other Person. No bonds, debentures, notes or other Indebtedness
of Parent having the right to vote (or convertible into, or exchangeable for, securities having the right to vote) on any matters on which
stockholders of Parent may vote, are issued or outstanding. There are no treasury shares of capital stock of any Parent Party.
(b)
Merger Sub is authorized to issue 1,000 shares of common stock, par value $0.0001 per share (“Merger Sub Common Stock”),
of which 1,000 shares of Merger Sub Common Stock are issued and outstanding as of the date hereof. No other shares of capital stock or
other voting securities of Merger Sub are issued, reserved for issuance or outstanding. All issued and outstanding shares of Merger Sub
Common Stock are duly authorized, validly issued, fully paid and nonassessable and are not subject to, and were not issued in violation
of, any purchase option, right of first refusal, preemptive right, subscription right or any similar right under any provision of the
DGCL, Merger Sub’s organizational documents or any contract to which Merger Sub is a party or by which Merger Sub is bound. There
are no outstanding contractual obligations of Merger Sub to repurchase, redeem or otherwise acquire any shares of Merger Sub Common Stock
or any equity capital of Merger Sub or any securities convertible into or exchangeable for any shares of capital stock of Merger Sub.
There are no outstanding contractual obligations of Merger Sub to provide funds to, or make any investment (in the form of a loan, capital
contribution or otherwise) in, any other Person. No bonds, debentures, notes or other Indebtedness of Merger Sub having the right to vote
(or convertible into, or exchangeable for, securities having the right to vote) on any matters on which stockholders of Merger Sub may
vote, are issued or outstanding.
(c)
Except for the 6,028,518 Parent Warrants outstanding, there are no outstanding warrants, options, agreements, convertible securities,
performance units or other commitments or instruments pursuant to which any Parent Party is or may become obligated to issue or sell any
of its shares of capital stock or other securities.
5.8 Information
Supplied. None of the information supplied or to be supplied by the Parent Parties expressly for inclusion or incorporation by reference
in the filings with the SEC and mailings to Parent’s stockholders with respect to the solicitation of proxies to approve the transactions
contemplated by this Agreement and the Additional Agreements, if applicable, will, at the date of filing or mailing, at the time of the
Parent Stockholder Meeting or at the Effective Time, as the case may be, contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under
which they are made, not misleading (subject to the qualifications and limitations set forth in the materials provided by Parent or included
in the Parent SEC Documents, the Additional Parent SEC Documents, the SEC Statement or any Other Filing).
5.9 Trust
Fund. As of the date of this Agreement, Parent has at least $57,383,990 in the trust fund established by Parent for the benefit of
its public stockholders (the “Trust Fund”) in a trust account (the “Trust Account”) maintained by
Continental Stock Transfer & Trust Company (the “Trustee”) at HSBC Bank, N.A., and such monies are invested in
“government securities” (as such term is defined in the Investment Company Act of 1940) and held in trust by the Trustee pursuant
to the Investment Management Trust Agreement dated as of August 12, 2021, between Parent and the Trustee (the “Trust Agreement”).
The Trust Agreement is valid and in full force and effect and enforceable in accordance with its terms, except as may be limited by the
Enforceability Exceptions, and has not been amended or modified. There are no separate agreements, side letters or other agreements or
understandings (whether written or unwritten, express or implied) that would cause the description of the Trust Agreement in the Parent
SEC Documents to be inaccurate in any material respect or that would entitle any Person (other than stockholders of Parent holding shares
of Parent Common Stock sold in Parent’s IPO who shall have elected to redeem their shares of Parent Common Stock pursuant to Parent’s
amended and restated certificate of incorporation) to any portion of the proceeds in the Trust Account. Prior to the Closing, none of
the funds held in the Trust Account may be released except in accordance with the Trust Agreement and Parent’s amended and restated
certificate of incorporation. The Parent has performed all material obligations required to be performed by it to date under, and is not
in material default or delinquent in performance or any other respect (claimed or actual) in connection with, the Trust Agreement, and,
to the knowledge of Parent, no event has occurred which, with due notice or lapse of time or both, would reasonably be expected to constitute
such a material default thereunder. There are no claims or proceedings pending with respect to the Trust Account.
5.10 Listing.
The Parent Public Common Stock, Parent Units, and Parent Public Warrants are listed on the NASDAQ, with trading tickers “ASPA,”
“ASPAU,” and “ASPAW,” respectively.
5.11 Board
Approval.
(a)
By resolutions duly adopted (and not thereafter modified or rescinded) by Parent’s Board of Directors (including any required committee
or subgroup of such board), the Board of Directors of Parent has unanimously (i) approved the execution, delivery and performance by Parent
and Merger Sub of this Agreement, the Additional Agreements to which it is a party and the consummation of the transactions contemplated
hereby and thereby, including the Merger, on the terms and subject to the conditions set forth herein and therein; (ii) determined that
this Agreement, the Additional Agreements to which a Parent Party is a party, and the transactions contemplated hereby and thereby, upon
the terms and subject to the conditions set forth herein, are advisable and in the best interests of Parent and Parent’s stockholders;
(iii) directed that the Parent Proposals be submitted to the Parent’s stockholders for consideration at the Parent Stockholder Meeting,
(iv) determined that the transactions contemplated hereby constitutes a “Business Combination” as such term is defined in
Parent’s amended and restated certificate of incorporation (“Business Combination”) and (v) recommended to the
Parent’s stockholders to adopt and approve each of the Parent Proposals (“Parent Board Recommendation”).
(b) By resolutions duly
adopted (and not thereafter modified or rescinded) by Merger Sub’s Board of Directors (including any required committee or subgroup
of such board), Merger Sub’s Board of Directors has, unanimously (i) approved the execution, delivery and performance by Merger
Sub of this Agreement, the Additional Agreements to which it is a party and the consummation of the transactions contemplated hereby
and thereby, including the Merger, on the terms and subject to the conditions set forth herein and therein, (ii) declared the advisability
of the transactions contemplated by this Agreement, (iii) determined that the transactions contemplated hereby are in the best interests
of its sole stockholder and (iv) recommended to Merger Sub’s sole stockholder to adopt this Agreement.
5.12 Parent
SEC Documents and Financial Statements.
(a)
Parent has filed all forms, reports, schedules, statements and other documents, including any exhibits thereto, required to be filed or
furnished by Parent with the SEC since Parent’s formation under the Exchange Act or the Securities Act, together with any amendments,
restatements or supplements thereto, and will use commercially reasonable efforts to file all such forms, reports, schedules, statements
and other documents required to be filed subsequent to the date of this Agreement and prior to the Closing (the “Additional Parent
SEC Documents”). Parent has made available to the Company true and complete copies in the form filed with the SEC of all of
the following, except to the extent available in full without redaction on the SEC’s website through EDGAR for at least two (2)
Business Days prior to the date of this Agreement: (i) Parent’s Annual Reports on Form 10-K for each fiscal year of Parent beginning
with the first year that Parent was required to file such a form, (ii) (ii) Parent’s Quarterly Reports on Form 10-Q for each fiscal
quarter of Parent beginning with the first quarter Parent was required to file such a form, (iii) all proxy statements relating to Parent’s
meetings of stockholders (whether annual or special) held, and all information statements relating to stockholder consents, since the
beginning of the first fiscal year referred to in clause (i) above, (iv) its Form 8-Ks filed since the beginning of the first fiscal year
referred to in clause (i) above, and (v) all other forms, reports, registration statements and other documents (other than preliminary
materials if the corresponding definitive materials have been provided to the Company pursuant to this Section 5.12) filed
by Parent with the SEC since Parent’s formation (the forms, reports, registration statements and other documents referred to in
clauses (i) through (v) above, whether or not available through EDGAR, collectively, the “Parent SEC Documents”).
(b)
Parent SEC Documents were, and the Additional Parent SEC Documents will be, prepared in all material respects in accordance with the requirements
of the Securities Act, the Exchange Act, and the Sarbanes-Oxley Act, as the case may be, and the rules and regulations thereunder. Parent
SEC Documents did not, and the Additional Parent SEC Documents will not, at the time they were or are filed, as the case may be, with
the SEC (except to the extent that information contained in any Parent SEC Document or Additional Parent SEC Document has been or is revised
or superseded by a later filed Parent SEC Document or Additional Parent SEC Document, then on the date of such filing) 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
made therein, in the light of the circumstances under which they were made, not misleading; provided, however,
that the foregoing does not apply to statements in or omissions in any information supplied or to be supplied by the Company Group expressly
for inclusion or incorporation by reference in the SEC Statement or Other Filing.
(c)
The financial statements and notes contained or incorporated by reference in the Parent SEC Documents and the Additional Parent SEC Documents
(collectively, the “Parent Financial Statements”) have been prepared in conformity with U.S. GAAP applied on a consistent
basis and in accordance with the requirements of the Public Company Accounting Oversight Board for public companies. The Parent Financial
Statements fairly present (or with respect such financial statements contained or incorporated by reference in the Additional Parent SEC
Documents, will fairly present) in all material respects, the financial position of Parent as of the dates thereof and the results of
operations of Parent for the periods reflected therein subject, in the case of the Unaudited Financial Statements, to normal audit adjustments
and the absence of notes thereto. The Parent Financial Statements were (or with respect such financial statements contained or incorporated
by reference in the Additional Parent SEC Documents, will be) prepared from the Books and Records of Parent in all material respects.
(d)
Except: (i) as specifically disclosed, reflected or fully reserved against on the Parent Financial Statements (including the notes thereto);
(ii) for liabilities and obligations incurred in the ordinary course of business consistent since March 19, 2021; (iii) for liabilities
that are executory obligations arising under Contracts to which any Parent Party is a party (none of which, with respect to the liabilities
described in clause (ii) and this clause (iii) results from, arises out of, or relates to any breach or violation of, or default
under, a Contract or applicable Law); and (iv) for expenses incurred in connection with the negotiation, execution and performance of
this Agreement, any Additional Agreement or any of the transactions contemplated hereby or thereby;, Parent does not have any material
liabilities, debts or obligations of any nature (whether accrued, fixed or contingent, liquidated or unliquidated, asserted or unasserted
or otherwise).
(e)
As used in this Section 5.12, the term “file” shall be broadly construed to include any manner in which a document
or information is furnished, supplied or otherwise made available to the SEC.
5.13 Certain
Business Practices. Neither Parent, nor any Representative of Parent has (a) used any funds for unlawful contributions, gifts, entertainment
or other unlawful expenses relating to political activity, (b) made any unlawful payment to foreign or domestic government officials,
employees or political parties or campaigns, (c) violated any provision of the Foreign Corrupt Practices Act or (d) made any other unlawful
payment. Neither Parent, nor any director, officer, agent or employee of Parent (nor any Person acting on behalf of any of the foregoing,
but solely in his or her capacity as a director, officer, employee or agent of Parent) has, since the IPO, directly or indirectly, given
or agreed to give any gift or similar benefit in any material amount to any customer, supplier, governmental employee or other Person
who is or may be in a position to help or hinder Parent or assist Parent in connection with any actual or proposed transaction, which,
if not given or continued in the future, would reasonably be expected to (i) adversely affect the business of Parent and (ii) subject
Parent to suit or penalty in any private or governmental Action.
5.14 Anti-Money
Laundering Laws. The operations of Parent are and have at all times been conducted in compliance with the Money Laundering Laws, and
no Action involving Parent with respect to the Money Laundering Laws is pending or, to the knowledge of Parent, threatened.
5.15 Affiliate
Transactions. Except as described in the Parent SEC Documents, there are no transactions, agreements, arrangements or understandings
between Parent or any of its subsidiaries, on the one hand, and any director, officer, employee, stockholder, warrant holder of Parent
or any Affiliate of Parent or any of its subsidiaries, on the other hand.
5.16 Litigation;
Permits. There is no (a) Action pending or, to the Knowledge of Parent, threatened against Parent or any of its subsidiaries or any
of its or their respective officers or directors or that affects its or their assets or properties or which, as of the date hereof, in
any manner challenges or seeks to prevent, enjoin, alter or delay the transactions contemplated by this Agreement or any Additional Agreement,
or (b) Order outstanding against Parent or any of its subsidiaries or that affects its or their assets or properties. Neither Parent nor
any of its subsidiaries is party to a settlement or similar agreement regarding any of the matters set forth in the preceding sentence
that contains any ongoing obligations, restrictions or liabilities (of any nature) that are material to Parent and its subsidiaries. Parent
holds all material Permits necessary to lawfully conduct its business as presently conducted, and to own, lease and operate its assets
and properties, all of which are in full force and effect.
5.17 Compliance
with Laws.
(a)
No Parent Party or, to the Knowledge of Parent, any Representative or other Person acting on behalf of a Parent Party, is in violation
in any material respect of, and, since March 19, 2021, no such Person has failed to be in compliance in all material respects with, all
applicable Laws and Orders. Since March 19, 2021, (i) no event has occurred or circumstance exists that (with or without notice or due
to lapse of time) would reasonably constitute or result in a violation by any Parent Party of, or failure on the part of any Parent Party
to comply with, or any liability suffered or incurred by any Parent Party in respect of any violation of or material noncompliance with,
any Laws, Orders or policies by Authority that are or were applicable to it or the conduct or operation of its business or the ownership
or use of any of its assets and (ii) no Action by any Authority is pending, or to the Knowledge of Parent, threatened, alleging any such
violation or noncompliance by a member of the Company Group. Since March 19, 2021, the Parent Parties have not been threatened in writing
or, to Parent’s Knowledge, orally to be charged with, or given written or, to Parent’s Knowledge, oral notice of any violation
of any Law or any judgment, order or decree entered by any Authority. Without limiting the generality of the foregoing, the Parent Parties
are, and since March 19, 2021 have been, to the Knowledge of Parent, in compliance in all material respects with: (i) every Law applicable
to the Parent Parties due to the specific nature of their business, including the Data Protection Laws; (ii) the Foreign Corrupt Practices
Act and any comparable or similar Law of any jurisdiction applicable to any Parent Party; and (iii) every Law regulating or covering
conduct in the workplace, including regarding sexual harassment or, on any legally impermissible basis, a hostile work environment. Since
March 19, 2021, the Parent Parties have not been threatened or charged in writing (or to Parent’s Knowledge, orally) with or given
written (or to Parent’s Knowledge, oral) notice of any violation of any Data Protection Law, the Foreign Corrupt Practices Act or
any other Law referred to in or generally described in foregoing sentence by any Authority and, to Parent’s Knowledge, the Parent
Parties are not under any investigations with respect to any such Law.
(b) Neither the Parent
Parties nor, to the Knowledge of Parent, any Representative or other Person acting on behalf of the Parent Parties is currently subject
to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department. Neither Parent nor, to the
Knowledge of Parent, any Representative of Parent (acting on behalf of Parent), (A) has participated in any transaction involving, including
receipt of funds from or issuing equity to, a Prohibited Party, or a Person who is the target of any Sanctions Laws, or any country or
territory that was during such period or is, or whose government was during such period or is, the target of comprehensive trade sanctions
under Sanctions Laws.
5.18 Absence
of Certain Changes. From the date of the latest balance sheet included in the Parent Financial Statements until the date of this Agreement,
(a) the Parent Parties have conducted their respective businesses in the ordinary course and in a manner consistent with past practices;
(b) there has not been any Material Adverse Effect in respect of Parent Parties; and (c) neither Parent Party has taken any action that,
if taken after the date of this Agreement and prior to the consummation of the Merger, would require the consent of the Company pursuant
to Section 6.1 and the Company has not given consent.
5.19 Indebtedness.
Except as set forth in the Parent SEC Documents, Parent does not have any Indebtedness or other liabilities.
5.20 Not
an Investment Company. No Parent Party is an “investment company” within the meaning of the Investment Company Act of
1940, as amended, and the rules and regulations promulgated thereunder.
5.21 Employment
Matters. The Parent Parties do not maintain, sponsor, contribute to and is not required to contribute to, and does not have any liability
to and could not reasonably be expected to have any Liability to any: “employee benefit plan” (as such term is defined in
Section 3(3) of ERISA, whether or not subject to ERISA), any severance, gratuity, termination indemnity, incentive or bonus, retention,
change in control, deferred compensation, profit sharing, retirement, welfare, post-employment welfare, vacation or paid-time-off, stock
purchase, stock option or equity incentive plan, program, policy, Contract or arrangement or any other stock purchase, stock option or
other equity or equity-based, termination, severance, transition, employment, individual consulting, retention, transaction, change-in-control,
fringe benefit, collective bargaining, bonus, incentive, deferred compensation, employee loan or other compensation or benefit plans,
agreements, programs, policies or other arrangements, whether or not subject to ERISA (collectively, the “SPAC Benefit Plans”)
and neither the execution and delivery of this Agreement nor the consummation of the transactions contemplated by this Agreement (either
alone or in combination with another event) will (a) result in any material payment (including severance, unemployment compensation, golden
parachute, bonus or otherwise) becoming due to any shareholder, director, officer or employee of the Parent Parties or (b) result in the
acceleration, vesting or creation of any rights of any shareholder, director, officer or employee of the Parent Parties to material (i)
payments or (ii) benefits or (iii) increases in any existing payments or benefits or any loan forgiveness. No amount that could be, or
has been, received (whether in cash or property or the vesting of property or the cancellation of Indebtedness) by any director, manager,
officer, employee, individual independent contractor or other service providers of any of the Parent Parties or their Affiliates under
any SPAC Benefit Plan or otherwise as a result of the consummation of the transactions contemplated by this Agreement could, separately
or in the aggregate, be nondeductible under Section 280G of the Code or subjected to an excise Tax under Section 4999 of the Code.
5.22 Tax
Matters.
(a) (i) Parent has duly
and timely filed all income Tax Returns and all other material Tax Returns which are required to be filed by or with respect to it, and
has paid all Taxes which have become due and payable; (ii) all such Tax Returns are true, correct and complete and accurate in all material
respects; (iii) there is no Action, pending or proposed in writing, with respect to Taxes of Parent; (iv) no statute of limitations in
respect of the assessment or collection of any Taxes of Parent for which a Lien may be imposed on any of Parent’s assets has been
waived or extended, which waiver or extension is in effect; (v) Parent has complied in all material respects with all applicable Laws
relating to the reporting, payment, collection and withholding of Taxes and has duly and timely withheld or collected, paid over to the
applicable Taxing Authority and reported all material Taxes (including income, social, security and other payroll Taxes) required to
be withheld or collected by Parent; (vi) there is no outstanding request for a ruling from any Taxing Authority, request for consent
by a Taxing Authority for a change in a method of accounting, subpoena or request for information by any Taxing Authority or agreement
with any Taxing Authority with respect to Parent; (vii) there is no Lien (other than Permitted Liens) for Taxes upon any of the assets
of Parent; (viii) no written claim has ever been made by a Taxing Authority in a jurisdiction where Parent has not paid any Tax or filed
Tax Returns, asserting that Parent is or may be subject to Tax in such jurisdiction, Parent is not nor has it ever been subject to Tax
in any country other than the respective countries of incorporation or formation of Parent members by virtue of having a permanent establishment
or other place of business in that country, and the members of Parent are and have always been tax residents solely in their respective
countries of incorporation or formation; (ix) Parent has made available to Company true, complete and correct copies of all Tax Returns
relating to, and all audit reports and correspondence relating to each proposed adjustment, if any, made by any Taxing Authority with
respect to, any taxable period since its formation; (x) there is no outstanding power of attorney from Parent authorizing anyone to act
on behalf of Parent in connection with any Tax, Tax Return or Action relating to any Tax or Tax Return of Parent; (xi) Parent is not,
and has ever been, a party to any Tax sharing, Tax indemnity or Tax allocation Contract (other than a contract entered into in the ordinary
course of business consistent with past practices, the primary purpose of which is not related to Taxes); (xii) Parent has not been a
member of an “affiliated group” within the meaning of Section 1504(a) of the Code filing a consolidated federal income Tax
Return (other than a group the common parent of which was the Parent); (xiii) Parent has no liability for the Taxes of any other Person:
(1) under Treasury Regulation Section 1.1502-6 (or any similar provision of applicable Law), (2) as a transferee or successor or by contract
or (3) otherwise by operation of applicable Law; (xiv) Parent has not requested any extension of time within which to file any Tax Return,
which Tax Return has since not been filed; (xv) the Parent is not a “United States real property holding corporation” within
the meaning of Section 897(c)(2) of the Code during the applicable period specified in Section 897(c)(1)(A)(ii) of the Code; and (xvi) the
Parent has not been a party to any “listed transaction” as defined in Section 6707A(c)(2) of the Code and Treasury Regulation
Section 1.6011-4(b)(2).
(b)
The Parent will not be required to include any item of income or exclude any item of deduction for any taxable period ending after the
Closing Date as a result of: (i) the use of, or change in, a method of accounting with respect to any transaction that occurred on or
before the Closing Date (ii) any closing agreement described in Section 7121 of the Code (or similar provision of state, local or
foreign Law); (iii) any installment sale or open sale transaction disposition made in a pre-Closing Tax period; (iv) any prepaid amount
received in a pre-Closing Tax period; or (v) any intercompany transaction or excess loss account described in Treasury Regulations under
Section 1502 of the Code (or any corresponding or similar provision of state, local or non-U.S. income Tax law).
(c)
The unpaid Taxes of Parent (i) did not, as of the most recent fiscal month end, exceed the reserve for Tax liability (rather than any
reserve for deferred Taxes established to reflect timing differences between book and Tax income) set forth on the Unaudited Financial
Statements and (ii) will not exceed that reserve as adjusted for the passage of time through the Closing Date in accordance with the past
custom and practice of Parent in filing its Tax Return.
(d)
The Parent has been in compliance in all respects with all applicable transfer pricing laws and legal requirements.
(e)
The Parent has not taken any action (nor permitted any action to be taken), and to the Parent’s Knowledge, there is no fact or circumstance
that would reasonably be expected to prevent the Merger from qualifying as a “reorganization” within the meaning of Section
368(a) of the Code.
5.23 HSR
Act. Parent has conducted its analysis of the HSR Act and has determined that the assets of the Parent are held in an irrevocable
trust without a reversionary interest and therefore, pursuant to 16 CFR 801.1(c) and the “size of the person” test under the
HSR Act (15 U.S.C. 18a(a)(2)(B)(ii)(II) and (III), no notification is required under the HSR Act in connection with the transactions contemplated
by this Agreement.
5.24 Opportunity
to Conduct Due Diligence. Without limiting any representation made herein by DLQ Parent or the Company, Parent hereby acknowledges
and agrees that prior to entering into this Agreement, Parent had the opportunity to conduct a due diligence review of the Company Group,
and to confirm all matters that Parent may deem relevant to its acquisition of the Company Group.
ARTICLE VI
COVENANTS OF THE PARTIES PENDING CLOSING
6.1 Conduct
of the Business. Each of the Company, DLQ Parent, Parent and Merger Sub covenants and agrees that:
(a)
Except as expressly contemplated by this Agreement or the Additional Agreements or as set forth on Schedule 6.1(a), from the
date hereof until the earlier of the Closing Date and the termination of this Agreement in accordance with its terms (the “Interim
Period”), each party shall (I) conduct its business only in the ordinary course (including the payment of accounts payable and
the collection of accounts receivable), consistent with past practices, (II) duly and timely file all material Tax Returns required to
be filed (or obtain a permitted extension with respect thereto) with the applicable
Taxing Authorities and pay any and all Taxes due and payable during such time period; (III) duly observe and conform with all applicable
Law, including the Exchange Act, and Orders, in each case, in all material respects, and (IV) use its commercially reasonable efforts
to preserve intact its business relationships with employees, clients, suppliers, contract research organizations and other third parties.
Without limiting the generality of the foregoing, and except as expressly contemplated by this Agreement or the Additional Agreements,
as required by applicable Law, or as set forth on Schedule 6.1(a), from the date hereof until the earlier of the Closing Date
and the termination of this Agreement in accordance with its terms, without the other party’s prior written consent (which shall
not be unreasonably conditioned, withheld or delayed), neither the Company nor Parent shall, nor shall Company, Parent or DLQ Parent permit
its Subsidiaries to:
(i)
amend, modify or supplement its certificate of incorporation or bylaws or other organizational or governing documents except as contemplated
hereby, or engage in any reorganization, reclassification, liquidation, dissolution or similar transaction;
(ii)
amend, waive any provision of, terminate prior to its scheduled expiration date, or otherwise compromise in any material way or relinquish
any material right under, any (A) in the case of any member of the Company Group, Material Contract, or (B) in the case of Parent or its
Subsidiaries, material contract, agreement, lease, license or other right or asset of such party or its Subsidiaries;
(iii)
other than in the ordinary course of business, modify, amend or enter into any contract, agreement, lease, license or commitment, including
for capital expenditures, that extends for a term of one year or more and obligates the payment by it of more than $250,000 (individually
or in the aggregate);
(iv)
make any capital expenditures in excess of $250,000 (individually or in the aggregate);
(v)
sell, lease, license or otherwise dispose of any of its material assets, except pursuant to existing contracts or commitments disclosed
herein or in the ordinary course of business consistent with past practices;
(vi)
solely in the case of any member of the Company Group, sell, lease, license or otherwise dispose of any of any material Company Group
Owned IP outside of the ordinary course of Business consistent with past practices;
(vii)
solely in the case of any member of the Company Group, permit any material Registered Owned IP to go abandoned or expire for failure to
make an annuity or maintenance fee payment, or fail to file any necessary document or take any necessary action to maintain such rights;
(viii)
except as contemplated hereby or by any Additional Agreement, (A) pay, declare or promise to pay any dividends or other distributions
with respect to its capital stock or other equity securities; or (B) amend any material term, right or obligation with respect to
any outstanding shares of its capital stock or other equity securities;
(ix)
(A) make any loan, advance or capital contribution in excess of $250,000 to any Person; (B) incur any Indebtedness in excess of $250,000
including drawings under the lines of credit, if any, other than (1) loans evidenced by promissory notes made to Parent as working capital
advances as described in the Prospectus and (2) intercompany Indebtedness; or (C) repay or satisfy any Indebtedness in excess of $250,000,
other than the repayment of Indebtedness in accordance with the terms thereof;
(x)
suffer or incur any Lien in excess of $250,000, except for Permitted Liens, on its assets;
(xi)
delay, accelerate or cancel, or waive any material right with respect to, any receivables or Indebtedness in excess of $250,000 owed to
it, or write off or make reserves in excess of $250,000 against the same (other than, in the case of the Company Group, in the ordinary
course of business consistent with past practices);
(xii)
merge or consolidate or enter a similar transaction with, or acquire all or substantially all of the assets or business of, any other
Person; make any material investment in any Person; or be acquired by any other Person;
(xiii)
terminate or allow to lapse any material insurance policy protecting any of its material assets, unless simultaneously with such termination
or lapse, a replacement policy underwritten by an insurance company of nationally recognized standing having comparable deductions and
providing coverage equal to or greater than the coverage under the terminated or lapsed policy for substantially similar premiums or less
is in full force and effect;
(xiv)
adopt any severance, retention or other employee plan involving obligations of such Person in excess of $250,000 in the aggregate, or
fail to continue to make timely contributions to each Plan in accordance with the terms thereof;
(xv)
institute, settle or agree to settle any Action before any Authority, in each case in excess of $500,000 (exclusive of any amounts covered
by insurance) or that imposes material injunctive or other material non-monetary relief on it;
(xvi)
except as required by U.S. GAAP, make any material change in its accounting principles, methods or practices or write down in any material
respect the value of its assets;
(xvii)
change its principal place of business or jurisdiction of organization;
(xviii)
issue, redeem or repurchase any capital stock, membership interests or other securities, or issue any securities exchangeable for or convertible
into any shares of its capital stock or other securities;
(xix)
(A) make, change or revoke any material Tax election; (B) change any annual Tax accounting periods in any material respect; (C) settle
or compromise any material claim, notice, audit report or assessment in respect of Taxes of the Company Group; (D) enter into any Tax
allocation, Tax sharing, Tax indemnity or other closing agreement relating to any Taxes of the Company Group; or (E) surrender or forfeit
any right to claim a material Tax refund;
(xx)
enter into any material transaction with or distribute or advance any material assets or property to any of its Affiliates (other than
its Subsidiaries), other than the payment of salary and benefits in the ordinary course;
(xxi)
other than as required by a Plan, (A) materially increase or change the compensation or benefits of any employee or service provider of
the Company Group other than in the ordinary course of business (including for promotions) (and in any event not in the aggregate by more
than ten percent (10%) when compared to such individual’s existing compensation or benefits), (B) accelerate the vesting or payment
of any material compensation or benefits of any employee or service provider of the Company Group, (C) make any loan to any present or
former employee or other individual service provider of the Company Group, other than advancement of expenses in the ordinary course of
business consistent with past practices, or (D) enter into, amend or terminate any collective bargaining agreement or other material agreement
with a labor union or labor organization;
(xxii)
fail to duly observe and conform to any applicable Laws and Orders in any material respect; or
(xxiii)
agree or commit to do any of the foregoing.
(b)
Notwithstanding the foregoing, each member of the Company Group and Parent and their respective Subsidiaries shall be permitted to take
any and all actions required to comply in all material respects with the quarantine, “shelter in place,” “stay at home,”
workforce reduction, social distancing, shut down, closure, sequester or any other Law, directive, guidelines or recommendations by any
Governmental Authority (including the Centers for Disease Control and the World Health Organization) in each case in connection with,
related to or in response to COVID-19, including the Coronavirus Aid, Relief, and Economic Security (CARES) Act or any changes thereto,
or other force majeure events and any such action or omission shall not be a breach of this Section 6.1 or any other provision of this
Agreement.
6.2 Exclusivity.
(a)
During the Interim Period, neither DLQ Parent nor any member of the Company Group, shall, and such Persons shall cause each of their respective
Representatives not to, without the prior written consent of Parent (which consent may be withheld in the sole and absolute discretion
of Parent), directly or indirectly, (i) encourage, solicit, initiate, engage or participate in negotiations with any Person concerning
any Alternative Transaction, (ii) take any other action intended or designed to facilitate the efforts of any Person relating to
a possible Alternative Transaction or (iii) approve, recommend or enter into any Alternative Transaction or any contract or agreement
related to any Alternative Transaction (a “Company Acquisition Agreement”). Immediately following the execution of
this Agreement, DLQ Parent and the Company Group, shall, and shall cause each of its Representatives, to terminate any existing discussion
or negotiations with any Persons other than Parent, concerning any Alternative Transaction. Each of DLQ Parent and the Company shall be
responsible for any acts or omissions of any of its respective Representatives that, if they were the acts or omissions of DLQ Parent
or the Company, would be deemed a breach of such party’s obligations under this Section 6.2(a) (it being understood that such responsibility
shall be in addition to and not by way of limitation of any right the Parent may have against such Representatives with respect to any
such acts or omissions). For purposes of this Agreement, the term “Alternative Transaction” means any of the following
transactions involving DLQ Parent or the Company or their respective Subsidiaries (other than the transactions contemplated by this Agreement
or the Additional Agreements): (A) any merger, consolidation, share exchange, business combination or other similar transaction (other
than between or among such party and/or its wholly-owned Subsidiaries), (B) any sale, lease, exchange, transfer or other disposition of
all or a material portion of the assets of such Person or any material portion of the capital stock or other equity interests of such
party or its Subsidiaries in a single transaction or series of transactions, (C) with respect to the Company, any purchase, lease, exchange,
transfer or other acquisition of (1) all or a material portion of the assets of any Person by the Company or (2) any capital stock or
other equity interests of any Person by the Company, in each case, in a single transaction or series of transactions.
(b)
In the event that there is an unsolicited proposal for, or an indication of interest in entering into, an Alternative Transaction (in
each case replacing the references to DLQ Parent or the Company with Parent in the definition of Alternative Transaction), communicated
in writing to Parent or any of its respective Representatives (each, an “Alternative Proposal”), Parent shall as promptly
as practicable (and in any event within three (3) Business Days after receipt thereof) advise DLQ Parent and the Company, orally and in
writing, of such Alternative Proposal and the material terms and conditions thereof (including any changes thereto) and the identity of
the Person making any such Alternative Proposal and Parent shall keep the Company and DLQ Parent informed on a reasonably current basis
of material developments with respect to any such Alternative Proposal.
(c)
The parties hereto agree that the rights and remedies for noncompliance with this Section 6.2 shall include the other
party hereto seeking to have such provision specifically enforced by any court having equity jurisdiction, it being acknowledged and agreed
that any such breach or threatened breach may cause irreparable injury to the other party hereto and that money damages may not provide
an adequate remedy to the other party hereto.
6.3 Access to Information.
During the Interim Period, DLQ Parent, the Company, and Parent shall each, use its commercially reasonable efforts to, (a) upon reasonable
prior written notice and during regular business hours, continue to give the other party, its legal counsel and its other Representatives
reasonable access to the offices, properties and Books and Records, (b) furnish to the other party, its legal counsel and its other Representatives
such information relating to the business of the Company Group and Parent as such Persons may reasonably request and (c) cause its employees,
legal counsel, accountants and other Representatives to reasonably cooperate with the other party in its investigation of the Business
(in the case of the Company Group) or the business of Parent (in the case of Parent); provided, that any investigation pursuant
to this Section 6.3 shall be conducted in such manner as not to interfere unreasonably with the conduct of the Business
of the Company Group. Notwithstanding anything to the contrary expressed or implied in this Agreement, neither party shall be required
to provide the access described above or disclose any information to the other party if doing so is, in such party’s reasonable
judgement, reasonably likely to (i) result in a waiver of attorney-client privilege, work product doctrine or similar privilege or (ii)
violate any contract to which it is a party or to which it is subject or any applicable Law. Notwithstanding anything herein to the contrary,
no such access or examination shall be permitted to the extent that it would require the Company Group to disclose (a) due diligence
questions, lists or investigations conducted by others, names, bids, letters of intent, expressions of interest, or other proposals received
from others in connection with the transactions contemplated hereby or otherwise information and analyses relating to such communications,
(b) information related to the analysis of the transactions contemplated hereby by DLQ Parent or any member of the Company Group, (c)
any document or information prohibited to be shared by Law until such time as such documents are not prohibited to be shared, and (d)
the Company and DLQ Parent must approve, in its sole discretion, and an officer of the Company and DLQ Parent must be present and included
in any communications with customers or employees of the Company. Parent agrees to abide by the confidentiality terms of the Confidentiality
Agreement and will treat such information as Confidential Information under the Confidentiality Agreement.
6.4 Notices
of Certain Events. During the Interim Period, each of Parent, DLQ Parent, and the Company shall promptly notify the other party of:
(a)
any notice from any Person alleging or raising the possibility that the consent of such Person is or may be required in connection with
the transactions contemplated by this Agreement or that the transactions contemplated by this Agreement might give rise to any Action
or other rights by or on behalf of such Person or result in the loss of any rights or privileges of the Company Group (or Parent, post-Closing)
to any such Person or create any Lien on any of the Company Group’s or Parent’s assets;
(b)
any notice or other material communication from any Authority in connection with the transactions contemplated by this Agreement or the
Additional Agreements;
(c)
any Actions commenced or, to the Knowledge of Parent or the Company, as applicable, threatened in writing against, relating to or involving
or otherwise affecting either party or any of their stockholders or their equity, assets or business and that relate to the consummation
of the transactions contemplated by this Agreement or the Additional Agreements;
(d)
the occurrence of any fact or circumstance which constitutes or results, or would reasonably be expected to constitute or result in a
Material Adverse Effect, upon having actual Knowledge of such occurrence; and
(e)
any inaccuracy of any representation or warranty of such party contained in this Agreement at any time during the term hereof, or any
failure of such party to comply with or satisfy any covenant, condition or agreement to be complied with or satisfied by it hereunder,
in either case, upon having actual Knowledge of such occurrence, that would reasonably be expected to cause any of the conditions set
forth in Section 9.2(a) or Section 9.2(b) with respect to the Company Group’s obligations under
this Section 6.4(e), or Sections 9.3(a) or Section 9.3(b) with respect to Parent’s
obligations under this Section 6.4(e), not to be satisfied.
6.5 Access
to Information. From time to time during the Interim Period the Company and DLQ Parent will supplement or amend the Disclosure Schedule
with respect to any matter Company or DLQ Parent becomes aware of which, if existing or occurring at or prior to the date hereof, would
have been required to be set forth or described in the Disclosure Schedules or which is necessary to correct any information in such Disclosure
Schedules which has been rendered inaccurate thereby. Any supplement or amendment to the Disclosure Schedule will be disregarded for the
purpose of determining whether the conditions set forth in Section 9.2(b) have been satisfied but may cure any breach or inaccuracy of
the representation or warranty amended by such amended disclosure with the consent of Parent, and in such case shall not constitute a
basis for any claim resulting from the breach of the representation or warranty such supplemented or amended Disclosure Schedule is intended
to modify.
6.6 Cooperation
with Form S-4/Proxy Statement; Other Filings.
(a)
During the Interim Period, the Company Group shall promptly provide to Parent such information concerning the Company Group as is either
required by the federal securities Laws or reasonably requested by Parent and appropriate for inclusion in the Offer Documents. Promptly
after the receipt by Parent from the Company of all such information, Parent shall prepare and file with the SEC, and with all other applicable
regulatory bodies, proxy materials for the purpose of soliciting proxies from (i) holders of Parent Common Stock sufficient to obtain
Parent Stockholder Approval at a meeting of holders of Parent Common Stock to be called and held for such purpose (the “Parent
Stockholder Meeting”) and (ii) holders of DLQ Parent common stock sufficient to obtain the DLQ Parent Stockholder Approval at
a meeting of holders of DLQ Parent Common Stock to be called and held for such purposes (the “DLQ Parent Stockholder Meeting”).
Such proxy materials shall be in the form of a proxy statement (the “Proxy Statement”), which shall be included in
a Registration Statement on Form S-4 (the “Form S-4”) filed by Parent with the SEC, pursuant to which the Parent Common
Stock issuable in the Merger (including, without limitation, the Dividend Shares) shall be registered. Parent shall promptly respond to
any SEC comments on the Form S-4 and Proxy Statement. The Proxy Statement, the Form S-4 and the documents included or referred to therein,
together with any supplements, amendments or exhibits thereto, are referred to herein as the “Offer Documents”.
(b)
Parent (i) shall permit DLQ Parent, the Company and its counsel to review and comment on the Proxy Statement and Form S-4 and any exhibits,
amendments or supplements thereto (or other related documents) at a reasonable time prior to the filing except to the extent not legally
permissible; (ii) shall consider any such comments reasonably and in good faith; and (iii) shall not file the Proxy Statement and Form
S-4 or any exhibit, amendment or supplement thereto without the prior written consent of DLQ Parent and the Company (not to be unreasonably
withheld, delayed or conditioned). As promptly as practicable after receipt thereof, Parent shall provide to DLQ Parent, the Company,
and its counsel notice and a copy of all correspondence (or, to the extent such correspondence is oral, a summary thereof), including
any comments from the SEC or its staff, between Parent or any of its Representatives, on the one hand, and the SEC or its staff or other
government officials, on the other hand, with respect to the Proxy Statement and the Form S-4, and, in each case, shall consult with DLQ
Parent, the Company, and its counsel concerning any such correspondence. Parent shall not file any response letters to any comments from
the SEC without the prior written consent of DLQ Parent and the Company (not to be unreasonably withheld, delayed or conditioned). Parent
will use its reasonable efforts to permit DLQ Parent’s and the Company’s counsel to participate in any calls, meetings or
other communications with the SEC or its staff. Parent will advise DLQ Parent and the Company, promptly after it receives notice thereof,
of the time when the Proxy Statement or the Form S-4 or any amendment or supplement thereto has been filed with the SEC and the time when
the Form S-4 declared effective or any stop order relating to the Form S-4 is issued.
(c)
As soon as practicable following the date on which the Form S-4 is declared effective by the SEC (the “S-4 Effective Date”),
Parent shall distribute the Proxy Statement to the holders of Parent Common Stock and DLQ Parent shall distribute its Proxy Statement
to the DLQ Parent Stockholders and, pursuant thereto, shall call the Parent and DLQ Parent Stockholder Meetings in accordance with their
respective organizational documents and the laws of the State of Delaware and, subject to the other provisions of this Agreement,
solicit proxies from such holders to vote in favor of the adoption of this Agreement and the approval of the transactions contemplated
hereby and the other matters presented to the Parent Stockholders and DLQ Parent Stockholders for approval or adoption at the Parent Stockholder
Meeting and DLQ Parent Stockholder Meeting, including, with respect to the Parent Stockholder Meeting, the matters described in Section
6.5(e).
(d)
DLQ Parent, Parent and the Company shall comply with all applicable provisions of and rules under the Securities Act and Exchange Act
and all applicable Laws of the State of Delaware, and the NASDAQ, if applicable, in the preparation, filing and distribution of the Form
S-4 and the Proxy Statement (or any amendment or supplement thereto), as applicable, the solicitation of proxies under the Proxy Statement
and the calling and holding of the Parent Stockholder Meeting and the DLQ Parent Stockholder Meeting. Without limiting the foregoing,
Parent and DLQ Parent shall ensure that each of the Form S-4, as of the S-4 Effective Date, and the Proxy Statement, as of the date on
which it is first distributed to Parent Stockholders and DLQ Parent Stockholders, and as of the dates of the Parent Stockholder Meeting
and the DLQ Stockholder Meeting, do not contain any untrue statement of a material fact or omit to state a material fact necessary in
order to make the statements made, in light of the circumstances under which they were made, not misleading (provided, that Parent
shall not be responsible for the accuracy or completeness of any information relating to DLQ Parent or the Company Group (or any other
information) that is furnished by DLQ Parent or the Company expressly for inclusion in the Proxy Statement and neither DLQ Parent nor
any member of the Company Group shall be responsible for the accuracy or completeness of any information relating to Parent (or any other
information) that is furnished by Parent expressly for inclusion in the Proxy Statement). If at any time prior to the Effective Time,
a change in the information relating to the Company Group or Parent or any other information furnished by Parent, Merger Sub, DLQ Parent,
or the Company for inclusion in the Proxy Statement, which would make the preceding sentence incorrect, should be discovered by Parent,
Merger Sub, DLQ Parent, or the Company, as applicable, such party shall promptly notify the other parties of such change or discovery
and an appropriate amendment or supplement describing such information shall be promptly filed with the SEC and, to the extent required
by Law, disseminated to Parent’s stockholders and DLQ Parent’s stockholders. In connection therewith, Parent, Merger Sub,
DLQ Parent, and the Company shall instruct their respective employees, counsel, financial advisors, auditors and other authorized representatives
to reasonably cooperate with Parent as relevant if required to achieve the foregoing.
(e) In accordance with
Parent’s amended and restated certificate of incorporation and applicable securities laws, rules and regulations, including the
DGCL and rules and regulations of the NASDAQ, in the Proxy Statement, Parent shall seek from the holders of Parent Common Stock the approval
the following proposals: (i) the Parent Stockholder Approval; (ii) adoption and approval of the second amended and restated certificate
of incorporation of Parent, in the form attached hereto as Exhibit G, including the change of the name of Parent to “DataLogiq,
Inc.” (the “Amended Parent Charter”); (iii) adoption and approval of the amended and restated bylaws of
Parent in the form attached hereto as Exhibit H; (iv) approval of the members of the Board of Directors of Parent immediately
after the Closing; (v) approval of the issuance of more than 20% of the issued and outstanding shares of Parent Common Stock to DLQ Parent
in connection with the Merger under applicable exchange listing rules; (vi) approval to adjourn the Parent Stockholder Meeting, if necessary;
and (vii) approval to obtain any and all other approvals necessary or advisable to effect the consummation of the Merger as reasonably
determined by the Company, DLQ Parent, and the Parent (the proposals set forth in the forgoing clauses (i) through (vii) collectively,
the “Parent Proposals”).
(f)
In accordance with DLQ Parent’s amended and restated certificate of incorporation and applicable securities laws, rules and regulations,
including the DGCL and rules and regulations of the OTCQX Market, in the Proxy Statement, DLQ Parent shall seek from the holders of DLQ
Parent Common Stock the approval the DLQ Parent Stockholder Approval.
(g)
Parent, with the assistance of DLQ Parent and the Company, shall use its reasonable best efforts to cause the S-4 and the Proxy Statement
to “clear” comments from the SEC and the S-4 to become effective as promptly as reasonably practicable thereafter. As soon
as practicable after the Proxy Statement is “cleared” by the SEC, Parent shall cause the Proxy Statement, together will all
other Offer Documents, to be disseminated to holders of Parent Common Stock and DLQ Parent shall cause its Proxy Statement together with
all other Offer Documents, to be disseminated to the holders of DLQ Parent Common Stock. The Offer Documents shall provide the public
stockholders of Parent with the opportunity to redeem all or a portion of their public shares of Parent Common Stock, up to that number
of shares of Parent Common Stock that would permit Parent to maintain consolidated net tangible assets of at least $5,000,001 either immediately
prior to or upon the consummation of the Merger, at a price per share equal to the pro rata share of the funds in the Trust Account, all
in accordance with and as required by Parent’s amended and restated certificate of incorporation, the Trust Agreement, applicable
Law and any applicable rules and regulations of the SEC. In accordance with Parent’s amended and restated certificate of incorporation,
the proceeds held in the Trust Account will first be used for the redemption of the shares of Parent Common Stock held by Parent’s
public stockholders who have elected to redeem such shares.
(h)
Parent and DLQ Parent shall each call and hold a special meeting of their respective stockholders as promptly as practicable after the
S-4 Effective Date for the purpose of seeking the approval of each of the Parent Proposals or DLQ Parent Stockholder Approval, respectively,
and shall consult each other in good faith with respect to the date on which such meeting is to be held. Neither party shall postpone
or adjourn its stockholder meeting without the prior written consent of the other (which shall not be unreasonably withheld, delayed or
conditioned) unless the requisite quorum is not obtained. Each of Parent and DLQ Parent shall use reasonable best efforts to solicit from
its stockholders proxies in favor of the approval and adoption of the Merger and this Agreement and the other Parent Proposals, as the
case may be. Parent’s Board of Directors shall recommend that the Parent Stockholders vote in favor of the Parent Proposals, and
neither Parent’s Board of Directors, nor any committee thereof, shall withhold, withdraw, amend, modify, change or propose or resolve
to withhold, withdraw, amend, modify or change, in each case in a manner adverse to the Company, such recommendation. DLQ Parent’s
Board of Directors shall recommend that the DLQ Parent Stockholders vote in favor of the DLQ Parent Stockholder Approval, and neither
DLQ Parent’s Board of Directors, nor any committee thereof, shall withhold, withdraw, amend, modify, change or propose or resolve
to withhold, withdraw, amend, modify or change, in each case in a manner adverse to the Parent, such recommendation. If on the date for
which the Parent Stockholder Meeting is scheduled (including any postponed or adjourned date), Parent has not received proxies representing
a sufficient number of shares to obtain the Parent Stockholder Approval or approve the other Parent Proposals, whether or not a quorum
is present, Parent shall make one or more successive postponements or adjournments of the Parent Stockholder Meeting, each such postponement
or adjournment to be no more than ten (10) Business Days, and shall continue to use reasonable best efforts to solicit from its stockholders
proxies in favor of the approval and adoption of the Merger and this Agreement and the other Parent Proposals; provided that,
without the consent of the Company, Parent shall not postpone or adjourn the Parent Stockholder Meeting to a date later than the Outside
Closing Date. If on the date for which the DLQ Parent Stockholder Meeting is scheduled (including any postponed or adjourned date), DLQ
Parent has not received proxies representing a sufficient number of shares to obtain the DLQ Parent Stockholder Approval, whether or not
a quorum is present, DLQ Parent shall make one or more successive postponements or adjournments of the DLQ Parent Stockholder Meeting,
each such postponement or adjournment to be no more than ten (10) Business Days, and shall continue to use reasonable best efforts to
solicit from its stockholders proxies in favor of the approval and adoption of the Merger and this Agreement; provided that,
without the consent of Parent, DLQ Parent shall not postpone or adjourn the DLQ Parent Stockholder Meeting to a date later than the Outside
Closing Date.
(i)
In connection with the preparation and filing of the Form S-4 and any amendments thereto, DLQ Parent and the Company Group shall reasonably
cooperate with the Parent and shall make their directors, officers and appropriate senior employees reasonably available to Parent and
its counsel in connection with the drafting of such filings and mailings and responding in a timely manner to comments from the SEC.
(j)
Notwithstanding anything else to the contrary in this Agreement or any Additional Agreements, Parent and DLQ Parent may make any public
filing with respect to the Merger to the extent required by applicable Law, provided that prior to making any filing that includes information
regarding the other party, the filing party shall provide a copy of the filing to the other party and permit the other party to make revisions
to protect confidential or proprietary information of such party.
(k)
Concurrently with the filing of the Form S-4, Parent shall register on Form S-1 (i) the shares of Parent Common Stock underlying the Parent
Warrants and (ii) the shares of Parent Common Stock owned by the Sponsor.
6.7 Trust
Account. Parent covenants that it shall cause the funds in the Trust Account to be disbursed in accordance with the Trust Agreement,
including for the payment of (a) all amounts payable to public holders of shares of Parent Common Stock (the “Parent Redemption
Amount”), (b) deferred underwriting commissions and the expenses of Parent and the Company Group to the third parties to which
they are owed, and (c) the remaining monies in the Trust Account to Parent or the Surviving Corporation after the Closing.
6.8 Obligations
of Merger Sub. Parent shall take all action necessary to cause Merger Sub to perform its obligations under this Agreement and to consummate
the transactions contemplated under this Agreement, upon the terms and subject to the conditions set forth in this Agreement, including
the prompt delivery to the Company (but in any event within one (1) Business Day following the execution of this Agreement) of the written
consent of the stockholder of Merger Sub approving this Agreement, the Merger and the other transactions contemplated by this Agreement
and the performance of the obligations of Merger Sub hereunder.
6.9 Proprietary
Information and Invention Assignment Agreement. The Company shall use commercially reasonable efforts to cause David Niaz to sign
a proprietary information and invention and assignment agreement in a form acceptable to Parent assigning to Company all right, title
and interest in and to all Intellectual Property invented, authored, or otherwise developed or created for or on behalf of any member
of the Company Group.
ARTICLE VII
COVENANTS OF THE PARTIES
7.1 Reporting;
Compliance with Laws; No Insider Trading. During the Interim Period,
(a)
DLQ Parent shall, on behalf of the Company Group, duly and timely file all Tax Returns required to be filed with the applicable Taxing
Authorities and pay any and all Taxes due and payable during such time period.
(b)
The Parent Parties shall duly and timely file all Tax Returns required to be filed with the applicable Taxing Authorities and pay any
and all Taxes due and payable during such time period.
(c)
The Company Group shall duly observe and conform in all material respects to all applicable Law, including the Exchange Act, and Orders.
(d)
The Parent Parties shall duly observe and conform in all material respects to all applicable Law, including the Exchange Act, and Orders.
(e)
DLQ Parent and the Company Group shall not, and it shall direct its Representatives to not, directly or indirectly, (i) purchase or sell
(including entering into any hedge transaction with respect to) any Parent Common Stock, Parent Unit, or Parent Warrant, except in compliance
with all applicable securities Laws, including Regulation M under the Exchange Act; (ii) use or disclose or permit any other Person to
use or disclose any information that Parent or its Affiliates has made or makes available to the Company and its Representatives in violation
of the Exchange Act, the Securities Act or any other applicable securities Law; or (iii) disclose to any third party any non-public information
about the Company, Parent, the Merger or the other transactions contemplated hereby or by any Additional Agreement.
(f) Parent shall not, and
it shall direct its Representatives to not, directly or indirectly, (i) purchase or sell (including entering into any hedge transaction
with respect to) any DLQ Parent Common Stock except in compliance with all applicable securities Laws, including Regulation M under the
Exchange Act; (ii) use or disclose or permit any other Person to use or disclose any information that DLQ Parent or its Affiliates has
made or makes available to Parent and its Representatives in violation of the Exchange Act, the Securities Act or any other applicable
securities Law; or (iii) disclose to any third party any non-public information about the Company Group, DLQ Parent, Parent, the Merger
or the other transactions contemplated hereby or by any Additional Agreement.
7.2 Commercially
Reasonable Efforts to Obtain Consents. DLQ Parent and the Company shall each use its commercially reasonable efforts to obtain any
required Company Group Consent. Parent shall use its commercially reasonable efforts to obtain any consent set forth on Schedule 5.4.
7.3 DLQ
Parent Stockholder Approval. DLQ Parent’s Board of Directors shall recommend that the DLQ Parent Stockholders vote in favor
of this Agreement, the Additional Agreements to which any member of the Company Group or DLQ Parent is or will be a party, the transactions
contemplated hereby and thereby and other related matters (the “DLQ Parent Board Recommendation”), and, neither DLQ
Parent’s Board of Directors, nor any committee thereof, shall withhold, withdraw, amend, modify, change or propose or resolve to
withhold, withdraw, amend, modify or change, in each case in a manner adverse to Parent, such DLQ Parent Board Recommendation.
7.4 Additional
Financial Information. The Company shall use commercially reasonable efforts to provide Parent on or prior to October 15, 2022 with
the Company Group Financial Statements, each prepared under U.S. GAAP and reviewed by a PCAOB qualified auditor in accordance with the
requirements of the PCAOB for public companies. Additionally, during the Interim Period, the Company shall use commercially reasonable
efforts to provide Parent with the Company’s consolidated interim financial information for each quarterly period beginning after
June 30, 2022 no later than 40 calendar days following the end of each quarterly period, each prepared under U.S. GAAP and reviewed by
a PCAOB qualified auditor in accordance with the requirements of the PCAOB for public companies. All of the financial statements to be
delivered pursuant to this Section 7.4, shall be accompanied by a certificate of the Chief Executive Officer of the Company
to the effect that all such financial statements fairly present the consolidated financial position and consolidated results of operations
of the Company Group as of the date or for the periods indicated, in accordance with U.S. GAAP, except as otherwise indicated in such
statements and subject to year-end audit adjustments. The Company Group will promptly provide with additional Company Group financial
information reasonably requested by Parent for inclusion in the Proxy Statement and any other filings to be made by Parent with the SEC.
7.5 Lock-Up
Agreements. Prior to the Closing, (i) DLQ Parent shall enter into a Lock-Up Agreement with Parent, effective as of the Closing, pursuant
to which Seventy-Five Percent (75%) of the Merger Consideration Shares shall be subject to lock-up, and (ii) the Company shall cause certain
management of the Company to enter into a Lock-Up Agreement with Parent, effective as of the Closing, pursuant to which any Dividend Shares
owned by such management shall be subject to a lock-up, both in accordance with the terms and conditions more fully set forth in the Lock-Up
Agreements.
7.6 Amended
Parent Charter. Prior to the Effective Time, subject to the Parent Stockholder Approval, Parent shall duly amend and restate its certificate
of incorporation to be in the form of the Amended Parent Charter by filing the Amended Parent Charter with the Delaware Secretary of State.
7.7 Preservation
of Intellectual Property; No New Related Company Customer Contracts. During the Interim Period (but subject to Section 9.2(l)-(n)
of this Agreement), (a) DLQ Parent shall not and shall cause each of the member of the Company Group not to: (i) sell, lease, license
transfer, pledge, encumber, grant or dispose of any Company Group Owned IP, excluding (A) non-exclusive licenses to use Company Group
Owned IP granted by Company or one of its Subsidiaries pursuant to a Company Customer Contract made by Company or one of its Subsidiaries
in the ordinary course of Business consistent with past practices and provided further that the non-exclusive license is limited to that
Company Group IP actually used by the Company Group Product provided by Company or one of its Subsidiaries under the Company Customer
Contract; and (B) any implied licenses in, to, or under Company Group Owned IP granted to a customer of Company or one of its Subsidiaries
arising in connection with the provision of a Company Group Product by Company or one of its Subsidiaries in the ordinary course of Business
consistent with past practices; (ii) abandon or fail to renew or timely maintain and pay annuities for, and otherwise timely prosecute
all Company Owned IP (including Registered Owned IP); and (iii) dedicate to the public or fail to safeguard and maintain the secrecy of
all Trade Secrets within the Company Owned IP; and (b) neither DLQ Parent nor any Sister Company shall enter into any new Related Company
Customer Contracts.
7.8 No
Dividends or Extraordinary Bonuses Until 11 Months After Closing. Except as expressly contemplated by this Agreement or the Additional
Agreements, or as required by applicable Law, from the Closing Date until 11 months after the date thereof, neither the Surviving Corporation
nor Parent shall, or shall permit its Subsidiaries to: (a) pay, declare or promise to pay any dividends, distributions or other amounts
with respect to its capital stock or other equity securities other than the Dividend Shares; or (b) pay, declare or promise to pay, any
bonus to any employee, except (i) year-end bonuses arising by operation of Law or by previously existing contract (without limit), and/or
(ii) on-going bonuses arising by operation of Law or by previously existing contract in an aggregate annual amount not to exceed $100,000.
7.9
Employment Agreements. The Company shall use its commercially reasonable efforts to enter into on or prior to Closing an employment agreement
with each of the Key Personnel identified on Schedule 1.1(A) hereto, which employment agreement may contain restrictive
covenant agreements as may be mutually agreed upon by the Company and Parent.
7.10 Senior
Financing Facility. The Company, Parent and Sponsor shall each use commercially reasonable efforts to enter into a mutually acceptable
agreement that provides that Sponsor shall be the exclusive financing source of the Company and Parent after the Business Combination
in an amount which shall not exceed $25 Million.
7.11 Record
Retention. For a period of seven years after the Closing Date, without the prior written consent of DLQ Parent (which will not be
unreasonably withheld), Parent will not, and Parent will cause the Surviving Corporation to not, dispose of or destroy any of the books
and records of the Company Group in the Surviving Corporation’s possession which would be reasonably be expected to be relevant
to any legal, regulatory or tax audit, investigation, inquiry or requirement of DLQ Parent (including, for the avoidance of doubt, the
DLQ Parent), without first offering such records to DLQ Parent. Parent will, and will cause the Surviving Corporation to, at reasonable
times upon reasonable notice, afford DLQ Parent and its representatives reasonable access (including the right to make, at DLQ Parent’s
expense, photocopies), during normal business hours, to such books and records in the Surviving Corporation’s possession as DLQ
Parent may reasonably request.
ARTICLE VIII
COVENANTS OF ALL PARTIES HERETO
8.1 Commercially
Reasonable Efforts; Further Assurances; Governmental Consents.
(a)
Subject to the terms and conditions of this Agreement, each party shall use its reasonable best efforts to take, or cause to be taken,
all actions and to do, or cause to be done, all things necessary or desirable under applicable Laws, or as reasonably requested by the
other parties, to consummate and implement expeditiously each of the transactions contemplated by this Agreement, including using its
reasonable best efforts to (i) obtain all necessary actions, nonactions, waivers, consents, approvals and other authorizations from all
applicable Authorities prior to the Effective Time; (ii) avoid an Action by any Authority, and (iii) execute and deliver any additional
instruments necessary to consummate the transactions contemplated by this Agreement. The parties shall execute and deliver such other
documents, certificates, agreements and other writings and take such other actions as may be necessary or desirable in order to consummate
or implement expeditiously each of the transactions contemplated by this Agreement.
(b) Subject to applicable
Law, each of DLQ Parent, the Company and Parent agrees to (i) reasonably cooperate and consult with the other regarding obtaining and
making all notifications and filings with Authorities, (ii) furnish to the other such information and assistance as the other may reasonably
request in connection with its preparation of any notifications or filings, (iii) keep the other reasonably apprised of the status of
matters relating to the completion of the transactions contemplated by this Agreement, including promptly furnishing the other with copies
of notices and other communications received by such party from, or given by such party to, any third party or any Authority with respect
to such transactions, (iv) permit the other party to review and incorporate the other party’s reasonable comments in any communication
to be given by it to any Authority with respect to any filings required to be made with, or action or nonactions, waivers, expirations
or terminations of waiting periods, clearances, consents or orders required to be obtained from, such Authority in connection with execution
and delivery of this Agreement and the consummation of the transactions contemplated by this Agreement and (v) to the extent reasonably
practicable, consult with the other in advance of and not participate in any meeting or discussion relating to the transactions contemplated
by this Agreement, either in person or by telephone, with any Authority in connection with the proposed transactions unless it gives
the other party the opportunity to attend and observe; provided, however, that, in each of clauses (iii) and
(iv) above, that materials may be redacted (A) as necessary to comply with contractual arrangements or applicable Laws, and (B) as necessary
to address reasonable attorney-client or other privilege or confidentiality concerns.
(c)
During the Interim Period, Parent, on the one hand, and the Company and DLQ Parent, on the other hand, shall each notify the other in
writing promptly after learning of any stockholder demands or other stockholder Action (including derivative claims) relating to this
Agreement, any of the Additional Agreements or any matters relating thereto commenced against Parent, any of the Parent Parties or any
of its or their respective Representatives in their capacity as a representative of a Parent Party or against any member of the Company
Group (collectively, the “Transaction Litigation”). The Parent shall control the negotiation, defense and settlement
of any such Transaction Litigation brought against the Parent, the Merger Sub or members of the boards of directors of the Parent or Merger
Sub and DLQ Parent shall control the negotiation, defense and settlement of any such Transaction Litigation brought against any member
of the Company Group or the members of their boards of directors; provided, however, that in no event shall DLQ Parent or the Parent settle,
compromise or come to any arrangement with respect to any Transaction Litigation, or agree to do the same, without the prior written consent
of the other party (not to be unreasonably withheld, conditioned or delayed); provided, that it shall be deemed to be reasonable for Parent
(if DLQ Parent is controlling the Transaction Litigation) or the DLQ Parent (if the Parent is controlling the Transaction Litigation)
to withhold, condition or delay its consent if any such settlement or compromise (A) does not provide for a legally binding, full, unconditional
and irrevocable release of each Parent Party (if the DLQ Parent is controlling the Transaction Litigation) or DLQ Parent and its Subsidiaries
and related parties (if the Parent is controlling the Transaction Litigation) and its respective Representative(s) that is the subject
of such Transaction Litigation, (B) provides for any non-monetary, injunctive, equitable or similar relief against any Parent Party (if
DLQ Parent is controlling the Transaction Litigation) or the DLQ Parent and its Subsidiaries and related parties (if the Parent is controlling
the Transaction Litigation) or (C) contains an admission of wrongdoing or Liability by a Parent Party (if DLQ Parent is controlling the
Transaction Litigation) or DLQ Parent and its Subsidiaries and related parties (if the Parent is controlling the Transaction Litigation)
and its respective Representative(s) that is the subject of such Transaction Litigation. Parent and DLQ Parent shall each (i) keep the
other reasonably informed regarding any Transaction Litigation, (ii) give the other the opportunity to, at its own cost and expense, participate
in the defense, settlement and compromise of any such Transaction Litigation and reasonably cooperate with the other in connection with
the defense, settlement and compromise of any such Transaction Litigation, (iii) consider in good faith the other’s advice with
respect to any such Transaction Litigation and (iv) reasonably cooperate with each other.
8.2 Compliance
with SPAC Agreements. Without the prior written consent of the Company, during the Interim Period, Parent shall (a) comply with the
Trust Agreement, the Underwriting Agreement, dated as of August 9, 2021, by and between Parent and Chardan Capital Markets, LLC and (b)
enforce the terms of (i) the letter agreement, dated as of August 9, 2021, by and among Parent, the Sponsor and each of the officers and
directors of Parent named therein, and (ii) the Stock Escrow Agreement, dated as of August 9, 2021, by and among Parent, Continental Stock
Transfer & Trust Company, as escrow agent, and the Sponsor and the other stockholders of Parent named therein.
8.3 Confidentiality.
Except as necessary to complete the SEC Statement, the other Offer Documents or any Other Filings, the Company and DLQ Parent, on the
one hand, and Parent and Merger Sub, on the other hand, shall comply with the Confidentiality Agreement.
8.4 Directors’
and Officers’ Indemnification and Liability Insurance.
(a)
All rights to indemnification for acts or omissions occurring through the Closing Date now existing in favor of the current directors
and officers, or has been at any time prior to the date hereof or who becomes prior to the Effective Time an officer or director, of the
Company or its Subsidiaries or the Parent Parties and Persons who served as a director, officer, member, trustee or fiduciary of another
corporation, partnership, joint venture, trust, pension or other employee benefit plan or enterprise at the request of the Company or
its Subsidiaries or the Parent Parties (collectively, the “D&O Indemnified Persons”), as provided in their respective
organizational documents or in any indemnification agreements shall survive the Merger and shall continue in full force and effect in
accordance with their terms. For a period of six (6) years after the Effective Time, Parent shall cause the organizational documents of
Parent and the Surviving Corporation and their respective Subsidiaries to contain provisions no less favorable with respect to exculpation
and indemnification of and advancement of expenses than are set forth as of the date of this Agreement in the organizational documents
of, with respect to Parent, Parent, and with respect to the Surviving Corporation and its Subsidiaries, the Company and its Subsidiaries,
as applicable, to the extent permitted by applicable Law.
(b)
Prior to the Closing, Parent and the Company shall reasonably cooperate in order to obtain (at the Surviving Corporation’s expense)
directors’ and officers’ liability insurance for Parent and the Company that shall be effective as of Closing and will cover
those Persons who will be the directors and officers of Parent and its Subsidiaries (including the Surviving Corporation after the Effective
Time) at and after the Closing on terms not less favorable than the better of (x) the terms of the current directors’ and officers’
liability insurance in place for the Company’s directors and officers and (y) the terms of a typical directors’ and officers’
liability insurance policy for a company whose equity is listed on NASDAQ which policy has a scope and amount of coverage that is reasonably
appropriate for a company of similar characteristics (including the line of business, anticipated market capitalization and revenues)
as the Company.
(c)
The provisions of this Section 8.4 are intended to be for the benefit of, and shall be enforceable by, D&O Indemnified
Persons and may not be changed with respect to any officer or director without his or her written consent. The obligations of Parent and
the Surviving Corporation under this Section 8.4 shall survive the consummation of the Merger and shall not be terminated or modified
in such a manner as to adversely affect any D&O Indemnified Person to whom this Section 8.4 applies without the consent of such affected
D&O Indemnified Person.
(d)
At or prior to the Effective Time, the Company shall obtain and fully pay the premium for a six year prepaid “tail” policy
for the extension of the directors’ and officers’ liability coverage of the Company’s and Parent’s existing directors’
and officers’ liability insurance policies, for claims reporting or discovery period of six years from and after the Effective Time,
on terms and conditions providing coverage retentions, limits and other material terms (other than premiums payable) substantially equivalent
to the current policies of directors’ and officers’ liability insurance maintained by the Company or the Parent, as the case
may be, with respect to matters arising on or before the Effective Time, covering without limitation the transactions contemplated hereby.
(e)
In the event Parent, the Surviving Corporation or any of their respective successors or assigns (i) consolidates with or merges into any
other Person and shall not be the continuing or surviving company or entity in such consolidation or merger or (ii) transfers all or substantially
all of its properties and assets to any Person, then, and in either such case, proper provision shall be made so that the successors and
assigns of Parent or the Surviving Corporation, as the case may be, shall assume all of the obligations set forth in this Section 8.4.
The agreements and covenants contained herein shall not be deemed to be exclusive of any other rights to which any D&O Indemnified
Persons is entitled, whether pursuant to applicable Laws, contract or otherwise. Nothing in this Agreement is intended to, shall be construed
to or shall release, waive or impair any rights to managers’ and officers’ insurance claims under any policy that is or has
been in existence with respect to the Company, any Subsidiary or their respective officers, managers and employees, it being understood
and agreed that the indemnification provided for in this Section 8.4 is not prior to, or in substitution for, any such claims under any
such policies.
8.5 Parent
Public Filings; NASDAQ. During the Interim Period, Parent will keep current and timely file all of its public filings with the SEC
and otherwise comply in all material respects with applicable securities Laws, and shall use its reasonable best efforts prior to the
Closing to maintain the listing of the Parent Units, the Parent Warrants and the Parent Rights on the NASDAQ Capital Markets. During the
Interim Period, Parent shall use its reasonable best efforts to cause (a) Parent’s initial listing application with the NASDAQ Capital
Markets in connection with the transactions contemplated by this Agreement to have been approved; (b) all applicable initial and continuing
listing requirements of the NASDAQ Capital Markets to be satisfied; and (c) the Parent Common Stock, including the Merger Consideration
Shares, the Parent Warrants and the Parent Rights to be approved for listing on the NASDAQ Capital Markets, subject to official notice
of issuance, in each case, as promptly as reasonably practicable after the date of this Agreement and in any event prior to the Effective
Time.
8.6 Certain Tax
Matters. Each of Parent and the Company shall use its reasonable best efforts to cause the Merger to qualify as a “reorganization”
within the meaning of Section 368(a) of the Code. Neither Parent nor the Company shall take any action, or fail to take any action, that
could reasonably be expected to cause the Merger to fail to qualify as a “reorganization” within the meaning of Section 368(a)
of the Code. Parent and the Company intend to report and, except to the extent otherwise required by a change in Law, shall report, for
U.S. federal income tax purposes, the Merger as a “reorganization” within the meaning of Section 368(a) of the Code, unless
otherwise required by applicable Law.
8.7 Parent
Equity Incentive Plan. Immediately after the Closing, Parent shall adopt a new equity incentive plan (such agreement not to be unreasonably
withheld, conditioned or delayed) (the “Parent Equity Incentive Plan”) upon such terms as Parent and the Company shall
mutually agree. The Parent Equity Incentive Plan shall have such number of shares available for issuance in total equal to ten percent
(10%) of the Parent Common Stock to be issued and outstanding immediately after the Closing.
ARTICLE IX
CONDITIONS TO CLOSING
9.1 Condition
to the Obligations of the Parties. The obligations of all of the parties to consummate the Closing are subject to the satisfaction
or written waiver (where permissible) by Parent and the Company of all the following conditions:
(a)
No provisions of any applicable Law and no Order shall restrain or prohibit or impose any condition on the consummation of the transactions
contemplated hereby, including the Merger.
(b)
each consent, approval or authorization of any Authority required of Parent, the Company or any of their respective Subsidiaries to consummate
the Merger that are set forth on Schedule 9.1(b) shall have been obtained and shall be in full force and effect.
(c)
There shall not be any pending Action brought by any Authority to enjoin or otherwise restrict the consummation of the Closing.
(d)
After giving effect to any redemption of shares of Parent Common Stock in connection with the transactions contemplated by this Agreement,
Parent shall have net tangible assets of at least $5,000,001 either immediately prior to or upon consummation of the Merger.
(e)
The DLQ Parent Stockholder Approval shall have been obtained.
(f)
DLQ Parent shall have transferred substantially all of the Intellectual Property assets Rebel AI, Inc. to the Company and all of the Intellectual
Property assets of Fixel AI, Inc. to the Company.
(g)
The Distribution shall be, in all respects, ready to be consummated as provided in this Agreement contemporaneously with the Closing of
the Merger.
(h)
Each of the Parent Proposals shall have been approved at the Parent Stockholder Meeting or at any adjournment or postponement thereof.
(i)
Parent’s initial listing application with NASDAQ in connection with the transactions contemplated by this Agreement shall have been
conditionally approved and, immediately following the Effective Time, Parent shall satisfy any applicable initial and continuing listing
requirements of NASDAQ, and Parent shall not have received any notice of non-compliance therewith, and the Merger Consideration Shares
shall have been approved for listing on the NASDAQ Capital Market.
(j)
The Form S-4 shall have become effective for registration of the Merger Consideration Shares (including, without limitation, the Dividend
Shares) in accordance with the provisions of the Securities Act, no stop order suspending the effectiveness of the Form S-4 shall have
been issued by the SEC that remains in effect and no proceeding seeking such a stop order shall have been initiated by the SEC and not
withdrawn.
9.2 Conditions
to Obligations of Parent and Merger Sub. The obligation of Parent and Merger Sub to consummate the Closing is subject to the satisfaction,
or the waiver in Parent’s sole and absolute discretion, of all the following further conditions:
(a)
The Company and DLQ Parent shall have duly performed or complied with, in all material respects, all of its obligations hereunder required
to be performed or complied with by the Company or DLQ Parent at or prior to the Closing Date.
(b) The representations
and warranties of the Company and DLQ Parent contained in this Agreement that are qualified by materiality shall be true and correct,
and the representations and warranties of the Company and DLQ Parent that are not so qualified shall be true and correct in all material
respects, in each case, as of the date of this Agreement and as of the Closing Date, as if made at and as of such date (except to the
extent that any such representation and warranty is made as of an earlier date, in which case such representation and warranty shall
be true and correct at and as of such earlier date).
(c)
Since the date of this Agreement, there shall not have occurred any Effect in respect of the Company Group, that individually, or together
with any other Effect since the date of this Agreement, has had or would reasonably be expected to have a Material Adverse Effect in respect
of the Company Group as a whole which is continuing and uncured.
(d)
Parent shall have received a certificate, dated as of the Closing Date, signed by the Chief Executive Officer of each of the Company and
DLQ Parent certifying the accuracy of the provisions of the foregoing clauses (a), (b), and (c) of this Section 9.2.
(e)
Parent shall have received a certificate, dated as of the Closing Date, signed by the Secretary of the Company attaching true, correct
and complete copies of (i) the Company Certificate of Incorporation, certified as of a recent date by the Secretary of State of the State
of Nevada; (ii) the Company’s Bylaws; (iii) copies of resolutions duly adopted by the Board of Directors of each of the Company
and DLQ Parent authorizing this Agreement, the Additional Agreements to which the Company is a party and the transactions contemplated
hereby; (iv) a certificate of good standing of the Company, certified as of a recent date by the Secretary of State of the State of Delaware
and (v) a written consent (in form and substance reasonably satisfactory to Parent) evidencing the Company Stockholder Approval that is
duly executed by DLQ Parent as the sole stockholder of the Company.
(f)
Each of the Company and DLQ Parent, as applicable, shall have executed and delivered to Parent a copy of each Additional Agreement to
which the Company or DLQ Parent or the Company’s management, as applicable, is a party and that was not otherwise executed and delivered
prior to the Closing.
(g)
The Company shall have delivered to Parent a duly executed certificate conforming to the requirements of Sections 1.897-2(h)(1)(i) and
1.1445-2(c)(3)(i) of the United States Treasury regulations, and a notice to be delivered to the United States Internal Revenue Service
as required under Section 1.897-2(h)(2) of the United States Treasury regulations, each dated no more than thirty (30) days prior to the
Closing Date and in form and substance reasonable acceptable to Parent.
(h)
The Company shall have obtained each Company Group Consent set forth on Schedule 9.2(h).
(i)
The Company shall have delivered to Parent a resignation from the Company of each director of the Company listed in Schedule 9.2(j),
effective as of the Closing Date.
(j)
The Company shall have entered into an agreement which provides that the Sponsor shall be the exclusive financing source of the Company
and Parent after Closing in an amount which shall not exceed $25 Million. Such agreement shall be on terms mutually agreed between the
parties.
(k)
The Company shall have (i) filed all income Tax Returns for the 2019, 2020 and 2021 tax years and (ii) paid all taxes with respect to
such tax years (including penalties and interest, if any, including, but not limited to penalties and interest as a result of such Tax
Returns being filed after the due date for filing each such Tax Return) Such Tax Returns will be true, correct and complete in all material
respects.
(l)
The DLQ Parent and Sister Companies shall have entered into one or more Intellectual Property assignment agreements acceptable to Parent
under which the DLQ Parent and each of the Sister Companies has assigned to Company all of their right, title and interest in and to all
Company Group Owned IP.
(m)
All Related Company Outbound IP Agreements and all Related Company Customer Agreements have been cancelled or terminated by DLQ Parent
or the applicable Sister Company or have expired on their own terms.
(n)
The DLQ Parent shall have changed its name to a new name that neither includes nor is confusingly similar to “Logiq,” “DataLogiq,”
or any of the Trademarks owned by the Company as of the date of this Agreement or as of the Closing Date, including any such Trademarks
owned by the Company as an operation of Section 9.2(l).
(o)
A true and accurate certificate of conversion of Rebel AI, LLC into Rebel AI, Inc. shall have been recorded against U.S. Patent No. 10,756,898
at the USPTO Patent Assignment Branch.
9.3 Conditions
to Obligations of the Company. The obligations of the Company to consummate the Closing is subject to the satisfaction, or the waiver
in the Company’s sole and absolute discretion, of all of the following further conditions:
(a)
Parent and Merger Sub shall each have duly performed or complied with, in all material respects, all of its respective obligations hereunder
required to be performed or complied with by Parent or Merger Sub, as applicable, at or prior to the Closing Date.
(b)
The representations and warranties of the Parent and Merger Sub contained in this Agreement that are qualified by materiality shall be
true and correct, and the representations and warranties of Parent and Merger Sub that are not so qualified shall be true and correct
in all material respects, in each case, as of the date of this Agreement and as of the Closing Date, as if made at and as of such date
(except to the extent that any such representation and warranty is made as of an earlier date, in which case such representation and warranty
shall be true and correct at and as of such earlier date).
(c)
Since the date of this Agreement, there shall not have occurred any Effect in respect of Parent that individually, or together with any
other Effect since the date of this Agreement, has had or would reasonably be expected to have a Material Adverse Effect in respect of
Parent.
(d)
The Company shall have received a certificate signed by the Chief Executive Officer of Parent accuracy of the provisions of the foregoing
clauses (a), (b), and (c) of this Section 9.3.
(e)
The Amended Parent Charter, in form and substance reasonably acceptable to Parent and the Company, shall have been filed with, and declared
effective by, the Delaware Secretary of State.
(f)
The Company shall have received a certificate, dated as of the Closing Date, signed by the Secretary of Parent attaching true, correct
and complete copies of (i) the amended and restated certificate of incorporation of Parent, certified as of a recent date by the Secretary
of State of the State of Delaware; (ii) bylaws of Parent, (iii) copies of resolutions duly adopted by the Board of Directors of Parent
authorizing this Agreement, the Additional Agreements to which Parent is a party and the transactions contemplated hereby and thereby
and the Parent Proposals; and (iv) a certificate of good standing of Parent, certified as of a recent date by the Secretary of State of
the State of Delaware.
(g)
The Company shall have received a certificate, dated as of the Closing Date, signed by the Secretary of Merger Sub attaching true, correct
and complete copies of (i) copies of resolutions duly adopted by the Board of Directors and sole stockholder of Merger Sub authorizing
this Agreement, the Additional Agreements to which Merger Sub is a party and the transactions contemplated hereby and thereby and (ii)
a certificate of good standing of Merger Sub, certified as of a recent date by the Secretary of State of the State of Delaware.
(h)
Each of Parent, Sponsor or other stockholder of Parent, as applicable, shall have executed and delivered to the Company a copy of each
Additional Agreement to which Parent, Sponsor or such other stockholder of Parent, as applicable, is a party.
(i)
The size and composition of the post-Closing Parent Board of Directors shall have been appointed as set forth in Section 2.8.
(j)
Parent shall have delivered to DLQ Parent and the Company true and complete copies of the resignations from the Parent Board of Directors
of all officers and directors of Parent to be effective as of the Effective Time.
(k)
After the redemption by all stockholders of Parent who have elected to redeem their shares of Parent, Parent shall have made all necessary
and appropriate arrangements with the Trustee to have all of the remaining funds contained in the Trust Account, as of such time disbursed
to Parent immediately prior to the Effective Time, and all such funds released from the Trust Account shall be available to Parent.
ARTICLE X
TERMINATION
10.1 Termination
Without Default.
(a)
In the event that (i) the Closing of the transactions contemplated hereunder has not occurred by February 12, 2023 (the “Outside
Closing Date”); and (ii) the material breach or violation of any representation, warranty, covenant or obligation under this
Agreement by the party (i.e., Parent or the Merger Sub, on one hand, or the Company or DLQ Parent, on the other hand) seeking to terminate
this Agreement was not the cause of, or resulted in, the failure of the Closing to occur on or before the Outside Closing Date, then each
of Parent and the Company, as applicable, shall have the right, at its sole option, to terminate this Agreement without liability to the
other party. Such right may be exercised by Parent or the Company, as the case may be, giving written notice to the other at any time
after the Outside Closing Date.
(b)
In the event an Authority shall have issued an Order or enacted a Law, having the effect of permanently restraining, enjoining or otherwise
prohibiting the Merger, which Order or Law is final and non-appealable, then each of Parent and the Company shall have the right, at its
sole option, to terminate this Agreement without liability to the other party; provided, however, that the right to terminate
this Agreement pursuant to this Section shall not be available to the Company or Parent if the failure by such party or its Affiliates
to comply with any provision of this Agreement has been a substantial cause of, or substantially resulted in, such action by such Authority.
(c)
This Agreement may be terminated at any time by mutual written consent of the Company and Parent duly authorized by each of their respective
boards of directors.
(d)
Parent may terminate this Agreement by giving written notice to the Company in the event that the Company does not deliver to Parent the
Company Group Financial Statements on or prior to October 15, 2022.
(e)
Parent may terminate this Agreement by giving written notice to the Company in the event that the Board of Parent, in exercising its fiduciary
duties, determines that the Business Combination is no longer in the best interests of the stockholders of the Parent.
(f)
The Parent and the Company shall each have the right, in its sole discretion, to terminate this Agreement if, at the Parent Stockholder
Meeting (including any postponements or adjournments thereof), the Required Parent Proposals shall fail to be approved by the affirmative
vote of Parent stockholders required under Parent’s organizational documents and applicable Law or if, at the DLQ Parent Stockholder
Meeting (including any postponements or adjournments thereof), the DLQ Parent Stockholder Approval shall fail to be approved by the affirmative
vote of DLQ Parent stockholders required under DLQ Parent’s organizational documents and applicable Law.
10.2 Termination
Upon Default.
(a)
Parent may terminate this Agreement by giving notice to the Company, without prejudice to any rights or obligations Parent or Merger Sub
may have: (i) at any time prior to the Closing Date if (x) the Company or DLQ Parent shall have breached any representation, warranty,
agreement or covenant contained herein to be performed on or prior to the Closing Date, which has rendered or would reasonably be expected
to render the satisfaction of any of the conditions set forth in Section 9.2(a) or 9.2(b) impossible;
and (y) such breach cannot be cured or is not cured by the earlier of the Outside Closing Date and thirty (30) days following receipt
by the Company or DLQ Parent, as the case may be, of a written notice from Parent describing in reasonable detail the nature of such breach;
(ii) at any time prior to the Closing Date if there shall have been any Effect in respect of the Company Group, that individually, or
together with any other Effect since the date of this Agreement, has had or would reasonably be expected to have a Material Adverse Effect
in respect of the Company Group as a whole which is uncurable and continuing; or (iii) at any time after the DLQ Parent Approval Deadline
if DLQ Parent has not previously received the DLQ Parent Stockholder Approval; provided, however, that no Parent Party is
then in breach of this Agreement so as to prevent the conditions to Closing set forth in Section 9.3(a) or Section
9.3(b) from being satisfied.
(b) The Company may terminate
this Agreement by giving notice to Parent, without prejudice to any rights or obligations the Company may have, at any time prior to
the Closing Date, if: (i) (x) Parent or Merger Sub shall have breached any of its covenants, agreements, representations, and warranties
contained herein to be performed on or prior to the Closing Date, which has rendered or reasonably would render the satisfaction of any
of the conditions set forth in Section 9.3(a) or Section 9.3(b) impossible; and (y) such breach cannot
be cured or is not cured by the earlier of the Outside Closing Date and thirty (30) days following receipt by Parent or Merger Sub of
a written notice from the Company describing in reasonable detail the nature of such breach; or (ii) there shall have been any Effect
in respect of Parent or Merger Sub, that individually, or together with any other Effect since the date of this Agreement, has had or
would reasonably be expected to have a Material Adverse Effect in respect of Parent or Merger Sub which is uncurable and continuing; provided,
however, that neither the Company nor DLQ Parent is then in breach of this Agreement so as to prevent the conditions to Closing set
forth in Section 9.2(a) or Section 9.2(b) from being satisfied.
10.3 Effect
of Termination. If this Agreement is terminated pursuant to this ARTICLE X (other than termination pursuant to Section
10.1(c)), this Agreement shall become void and of no further force or effect without liability of any party (or any shareholder, director,
officer, employee, Affiliate, agent, consultant or representative of such party) to the other parties hereto; provided that,
if such termination shall result from the willful breach by a party or its Affiliate of its covenants and agreements hereunder or Fraud
in connection with the transactions contemplated by this Agreement, such party shall not be relieved of liability to the other parties
for any such willful breach or Fraud. The provisions of Section 8.3, this Section 10.3, ARTICLE XI and ARTICLE
XII, and the Confidentiality Agreement, shall survive any termination hereof pursuant to this ARTICLE X.
ARTICLE XI
NON-SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS;
CONSEQUENCES OF BREACH
11.1 Non-Survival.
The representations and warranties of the parties, and the agreements and covenants of the parties to be performed prior to or at the
Effective Time, in this Agreement and in any certificate delivered pursuant hereto shall terminate at the Effective Time except that the
agreements set forth in Article II and Article III and Sections 6.7, 7.13, 8.3, 8.4, 8.6, 8.7, this Article XI and Article XII, and any
corresponding definitions in Article I used in such sections, shall survive the Effective Time.
11.2 No
Remedy. Except in the case of Fraud, there shall be no remedy available to Parent and/or the Surviving Corporation and their respective
successors and permitted assigns, their respective officers, directors, managers, employees, Affiliates and Representatives (collectively,
the “Parent Post-Closing Parties”) for any and all losses or damages that are sustained or incurred by any of the Parent
Post-Closing Parties by reason of, resulting from or arising out of any breach of or inaccuracy in any of DLQ Parent’s or the Company’s
representations or warranties contained in this Agreement. Except for the purposes of determining the obligations of Parent to consummate
the transactions contemplated by this Agreement in accordance with Section 9.2(b), (a) the representations and warranties provided by
the Company and DLQ Parent in this Agreement (including Article IV) are provided for informational purposes only and (b) the Company,
DLQ Parent and the equityholders of DLQ Parent, shall have no liability to any Parent Post-Closing Party for any Losses incurred due to
any fact or circumstance that constitutes a breach of any representation or warranty of DLQ Parent or the Company contained in this Agreement.
Except in the case of Fraud, there shall be no remedy available to the Company, DLQ Parent and their respective successors and permitted
assigns, its respective officers, directors, managers, employees, Affiliates and Representatives (collectively, the “Company Parties”)
for any and all losses or damages that are sustained or incurred by any of the Company Parties by reason of, resulting from or arising
out of any breach of or inaccuracy in any of Parent’s or Merger Sub’s representations or warranties contained in this Agreement.
Except for the purposes of determining the obligations of the Company to consummate the transactions contemplated by this Agreement in
accordance with Section 9.3(b), (a) the representations and warranties provided by Parent and Merger Sub in this Agreement (including
Article V) are provided for informational purposes only and (b) Parent shall have no liability to any Company Party for any Losses incurred
due to any fact or circumstance that constitutes a breach of any representation or warranty of Parent or Merger Sub contained in this
Agreement. For purposes hereof, “Fraud” means, with respect to any party, actual and intentional fraud with respect to the
making of the representations and warranties pursuant to Article IV or Article V, as applicable, provided, that (1) such actual and intentional
fraud of the Company shall only be deemed to exist if any of the persons set forth on Schedule A had actual knowledge (as opposed to imputed
or constructive knowledge) that any of the representations and warranties made by the Company and DLQ Parent in Article IV, as qualified
by the Disclosure Schedule, was actually breached when made and such breach was made with the intent to mislead Parent, and (2) such actual
and intentional fraud of Parent or Merger Sub shall only be deemed to exist if the persons set forth on Schedule B had actual knowledge
(as opposed to imputed or constructive knowledge) that any of the representations and warranties made by Parent or Merger Sub in Article
V was actually breached when made and such breach was made with the intent to mislead the Company and DLQ Parent.
ARTICLE XII
MISCELLANEOUS
12.1 Notices.
Any notice hereunder shall be sent in writing, addressed as specified below, and shall be deemed given: (a) if by hand or nationally recognized
overnight courier service, by 5:00 PM Pacific Time on a Business Day, addressee’s day and time, on the date of delivery, and if
delivered after 5:00 PM Pacific Time, on the first Business Day after such delivery; (b) if by email, on the date of transmission with
affirmative confirmation of receipt; or (c) three (3) Business Days after mailing by prepaid certified or registered mail, return receipt
requested. Notices shall be addressed to the respective parties as follows (excluding telephone numbers, which are for convenience only),
or to such other address as a party shall specify to the others in accordance with these notice provisions:
If
to DLQ Parent (pre- or post-Closing), to:
Logiq,
Inc.
85
Broad Street, 16-079
New
York, New York 10004
Attention:
Brent Suen
Email:
brent@logiq.com
with a copy (which shall not constitute
notice) to:
Procopio, Cory, Hargreaves &
Savitch LLP
12544 High Bluff Drive, Suite 400
San Diego, CA 92130
Attention: Christopher Tinen
Email: chris.tinen@procopio.com
if to the Company (or,
following the Closing, the Surviving Corporation or Parent), to:
DLQ, Inc.
85 Broad Street,
16-079
New York, New
York 10004
Attention: Brent
Suen
with a copy (which shall not constitute
notice) to:
Procopio, Cory, Hargreaves &
Savitch LLP
12544 High Bluff Drive, Suite 400
San Diego, CA 92130
Attention: Christopher Tinen
if to Parent or Merger
Sub (prior to the Closing):
Abri SPAC I, Inc.
9663 Santa Monica Blvd., No. 1091,
Beverly Hills, CA 90210
Attn: Jeffrey Tirman, Chief Executive
Officer
E-mail: jtirman@abriadv.com
with a copy (which shall not constitute
notice) to:
Loeb & Loeb LLP
345 Park Ave
New York, NY 10154
Attention: Mitchell S. Nussbaum
E-mail: mnussbaum@loeb.com
No notice to any of DLQ
Parent, the Company, Parent or Merger Sub shall be deemed given or received unless the entity noted “with a copy to” is simultaneously
given notice in the same manner as any notice given to the DLQ Parent, the Company, Parent or Merger Sub as the case may be; provided,
however, that no notice to such party shall constitute notice to DLQ Parent, the Company, Parent or Merger Sub for purposes of this Section
12.1.
12.2 Amendments;
No Waivers; Remedies.
(a)
This Agreement cannot be amended, except by a writing signed by each party, and cannot be terminated orally or by course of conduct. No
provision hereof can be waived, except by a writing signed by the party against whom such waiver is to be enforced, and any such waiver
shall apply only in the particular instance in which such waiver shall have been given.
(b)
Neither any failure or delay in exercising any right or remedy hereunder or in requiring satisfaction of any condition herein nor any
course of dealing shall constitute a waiver of or prevent any party from enforcing any right or remedy or from requiring satisfaction
of any condition. No notice to or demand on a party waives or otherwise affects any obligation of that party or impairs any right of the
party giving such notice or making such demand, including any right to take any action without notice or demand not otherwise required
by this Agreement. No exercise of any right or remedy with respect to a breach of this Agreement shall preclude exercise of any other
right or remedy, as appropriate to make the aggrieved party whole with respect to such breach, or subsequent exercise of any right or
remedy with respect to any other breach.
(c)
Except as otherwise expressly provided herein, no statement herein of any right or remedy shall impair any other right or remedy stated
herein or that otherwise may be available.
(d)
Notwithstanding anything to the contrary contained herein, no party shall seek, nor shall any party be liable for, punitive or exemplary
damages under any tort, contract, equity or other legal theory with respect to any breach (or alleged breach) of this Agreement or any
provision hereof or any matter otherwise relating hereto or arising in connection herewith.
12.3 Arm’s
Length Bargaining; No Presumption Against Drafter. This Agreement has been negotiated at arm’s-length by parties of equal bargaining
strength, each represented by counsel or having had but declined the opportunity to be represented by counsel and having participated
in the drafting of this Agreement. This Agreement creates no fiduciary or other special relationship between the parties, and no such
relationship otherwise exists. No presumption in favor of or against any party in the construction or interpretation of this Agreement
or any provision hereof shall be made based upon which Person might have drafted this Agreement or such provision.
12.4 Publicity.
Except as required by Law or applicable stock exchange rules and except with respect to the Additional Parent SEC Documents or any forms,
reports, schedules, statements and other documents required to be filed subsequent to the date of this Agreement and prior to the Closing
with the SEC by DLQ Parent, the parties agree that neither they nor their Representatives shall issue any press release or make any other
public disclosure concerning the transactions contemplated hereunder without the prior approval of the other party hereto. If a party
is required to make such a disclosure as required by law or applicable stock exchange rules, the party making such determination will,
if practicable in the circumstances, use reasonable commercial efforts to allow the other party reasonable time to comment on such disclosure
in advance of its issuance.
12.5 Expenses.
The costs and expenses in connection with this Agreement and the transactions contemplated hereby shall be paid by Parent after the Closing.
If the Closing does not take place, each party shall be responsible for its own expenses.
12.6 No
Assignment or Delegation. No party may assign any right or delegate any obligation hereunder, including by merger, consolidation,
operation of law or otherwise, without the written consent of the other party. Any purported assignment or delegation without such consent
shall be void, in addition to constituting a material breach of this Agreement.
12.7 Governing
Law. This Agreement and all disputes or controversies arising out of or relating to this Agreement or the transactions contemplated
hereby, including the applicable statute of limitations, shall be governed by and construed in accordance with the Laws of the State of
Delaware, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of Delaware or any other
jurisdiction) that would cause the application of the Law of any jurisdiction other than the State of Delaware.
12.8 Counterparts;
Facsimile Signatures. This Agreement may be executed in counterparts, each of which shall constitute an original, but all of which
shall constitute one agreement. This Agreement shall become effective upon delivery to each party of an executed counterpart or the earlier
delivery to each party of original, photocopied, or electronically transmitted signature pages that together (but need not individually)
bear the signatures of all other parties (including pdf or any electronic signature complying with the U.S. federal ESIGN Act of 2000,
e.g., www.docusign.com).
12.9 Entire
Agreement. This Agreement, together with the Additional Agreements, sets forth the entire agreement of the parties with respect to
the subject matter hereof and thereof and supersedes all prior and contemporaneous understandings and agreements related thereto (whether
written or oral), all of which are merged herein. Except as otherwise expressly stated herein or in any Additional Agreement, there is
no condition precedent to the effectiveness of any provision hereof or thereof. Notwithstanding the foregoing, the Confidentiality Agreement
is not superseded by this Agreement or merged herein and shall continue in accordance with its terms, including in the event of any termination
of this Agreement, until the Closing.
12.10 Severability.
A determination by a court or other legal authority that any provision that is not of the essence of this Agreement is legally invalid
shall not affect the validity or enforceability of any other provision hereof. The parties shall cooperate in good faith to substitute
(or cause such court or other legal authority to substitute) for any provision so held to be invalid a valid provision, as alike in substance
to such invalid provision as is lawful.
12.11 Further
Assurances. Each party shall execute and deliver such documents and take such action, as may reasonably be considered within the scope
of such party’s obligations hereunder, necessary to effectuate the transactions contemplated by this Agreement.
12.12 Third
Party Beneficiaries. Except as provided in Section 8.4 and Section 12.19, neither this Agreement nor
any provision hereof confers any benefit or right upon or may be enforced by any Person not a signatory hereto.
12.13 Waiver.
Reference is made to the Prospectus. The Company has read the Prospectus and understands that Parent has established the Trust Account
for the benefit of the public shareholders of Parent and the underwriters of the IPO pursuant to the Trust Agreement and that, except
for a portion of the interest earned on the amounts held in the Trust Account, Parent may disburse monies from the Trust Account only
for the purposes set forth in the Trust Agreement. For and in consideration of Parent agreeing to enter into this Agreement, the Company
and DLQ Parent each hereby agrees that it does not now and shall not at any time hereafter prior to the Closing have any right, title,
interest or claim of any kind in or to any monies in the Trust Account as a result of, or arising out of, any negotiations, contracts
or agreements with Parent and hereby agrees that it will not seek recourse against the Trust Account for any reason. Notwithstanding the
foregoing, nothing contained in this Section 12.13 shall serve to limit or prohibit (x) the Company’s or DLQ Parent’s
right to pursue a claim against assets held outside the Trust Account (other than distributions therefrom to Parent’s public shareholders
that elect to redeem their shares in connection with the consummation of the Parent’s initial business combination or an extension
of Parent’s deadline to consummate its initial business combination or that receive proceeds from the Trust Account upon the liquidation
of Parent if it fails to meet its deadline to consummate its initial business combination (“Public Distributions”),
for specific performance or other non-monetary relief, or (y) any claims that the Company or DLQ Parent may have in the future against
assets or funds that are not held in the Trust Account (including any funds that have been released from such trust account and any assets
that have been purchased or acquired with any such funds, but excluding Public Distributions).
12.14 No
Other Representations; No Reliance.
(a) NONE OF THE COMPANY,
DLQ PARENT, NOR ANY OF THEIR RESPECTIVE REPRESENTATIVES HAS MADE ANY REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, OF ANY NATURE
WHATSOEVER RELATING TO THE COMPANY GROUP OR THE BUSINESS OR OTHERWISE IN CONNECTION WITH THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT
OR ANY ADDITIONAL AGREEMENT, OTHER THAN THOSE REPRESENTATIONS AND WARRANTIES EXPRESSLY SET FORTH IN ARTICLE IV, IN EACH CASE,
AS MODIFIED BY THE SCHEDULES TO THIS AGREEMENT. Without limiting the generality of the foregoing, neither the Company, DLQ Parent nor
any of their respective representatives has made, and shall not be deemed to have made, any representations or warranties in the materials
relating to the Company Group made available to Parent and its representatives, including due diligence materials, or in any presentation
of the business of the Company Group by management of the Company, DLQ Parent or others in connection with the transactions contemplated
hereby, and no statement contained in any of such materials or made in any such presentation shall be deemed a representation or warranty
hereunder or otherwise or deemed to be relied upon by Parent or Merger Sub in executing, delivering and performing this Agreement, the
Additional Agreements or the transactions contemplated hereby or thereby, in each case except for the representations and warranties
set forth in ARTICLE IV as modified by the Schedules to this Agreement. It is understood that any cost estimates, projections
or other predictions, any data, any financial information or any memoranda or offering materials or presentations, including any offering
memorandum or similar materials made available by the Company, DLQ Parent or their respective representatives are not and shall not be
deemed to be or to include representations or warranties of the Company or DLQ Parent, and are not and shall not be deemed to be relied
upon by Parent or Merger Sub in executing, delivering and performing this Agreement, the Additional Agreement and the transactions contemplated
hereby or thereby, in each case except for the representations and warranties set forth in ARTICLE IV, in each case, as modified
by the Schedules to this Agreement. Except for the specific representations and warranties expressly made by the Company and DLQ Parent
in ARTICLE IV, in each case as modified by the Schedules: (a) Parent acknowledges and agrees that: (i) neither the Company,
DLQ Parent nor any of their respective representatives is making or has made any representation or warranty, express or implied, at law
or in equity, in respect of the Company Group, the business, assets, liabilities, operations, prospects or condition (financial or otherwise)
of the Company Group, the nature or extent of any liabilities of the Company Group, the effectiveness or the success of any operations
of the Company Group or the accuracy or completeness of any confidential information memoranda, projections, forecasts or estimates of
earnings, or other information (financial or otherwise) regarding the Company Group furnished to Parent, Merger Sub or their respective
representatives or made available to Parent and its representatives in any “data rooms,” “virtual data rooms,”
management presentations or any other form in expectation of, or in connection with, the transactions contemplated hereby, or in respect
of any other matter or thing whatsoever; and (ii) no representative of DLQ Parent or the Company has any authority, express or implied,
to make any representations, warranties or agreements not specifically set forth in ARTICLE IV and subject to the limited
remedies herein provided; (b) each of Parent and Merger Sub specifically disclaims that it is relying upon or has relied upon any such
other representations or warranties that may have been made by any Person, and acknowledges and agrees that DLQ Parent and the Company
have specifically disclaimed and do hereby specifically disclaim any such other representation or warranty made by any Person; and (c)
none of the Company, the DLQ Parent nor any other Person shall have any liability to Parent, Merger Sub or any other Person with respect
to any such other representations or warranties, including projections, forecasts, estimates, plans or budgets of future revenue, expenses
or expenditures, future results of operations, future cash flows or the future financial condition of the Company Group or the future
business, operations or affairs of the Company Group.
(b) NONE OF THE PARENT,
MERGER SUB NOR ANY OF THEIR RESPECTIVE REPRESENTATIVES HAS MADE ANY REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, OF ANY NATURE
WHATSOEVER RELATING TO THE PARENT, MERGER SUB OR OTHERWISE IN CONNECTION WITH THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR ANY
ADDITIONAL AGREEMENT, OTHER THAN THOSE REPRESENTATIONS AND WARRANTIES EXPRESSLY SET FORTH IN ARTICLE V, IN EACH CASE, AS
MODIFIED BY THE SCHEDULES TO THIS AGREEMENT AND THE PARENT SEC DOCUMENTS. Without limiting the generality of the foregoing, neither the
Parent, the Merger Sub nor any of their respective representatives has made, and shall not be deemed to have made, any representations
or warranties in the materials relating to the Parent and the Merger Sub made available to Company and DLQ Parent and their representatives,
including due diligence materials, or in any presentation of the business of the Parent by management of the Parent or others in connection
with the transactions contemplated hereby, and no statement contained in any of such materials or made in any such presentation shall
be deemed a representation or warranty hereunder or otherwise or deemed to be relied upon by the Company and DLQ Parent in executing,
delivering and performing this Agreement, the Additional Agreements or the transactions contemplated hereby or thereby, in each case
except for the representations and warranties set forth in ARTICLE V as modified by the Schedules to this Agreement
and the Parent SEC Documents. It is understood that any cost estimates, projections or other predictions, any data, any financial information
or any memoranda or offering materials or presentations, including any offering memorandum or similar materials made available by the
Parent, the Merger Sub or their respective representatives are not and shall not be deemed to be or to include representations or warranties
of the Parent and Merger Sub, and are not and shall not be deemed to be relied upon by Company or DLQ Parent in executing, delivering
and performing this Agreement, the Additional Agreement and the transactions contemplated hereby or thereby, in each case except for
the representations and warranties set forth in ARTICLE V, in each case, as modified by the Schedules to this Agreement and
the Parent SEC Documents. Except for the specific representations and warranties expressly made by the Parent and Merger Sub in ARTICLE
V, in each case as modified by the Schedules and Parent SEC Documents: (a) the Company acknowledges and agrees that: (i) neither
the Parent, Merger Sub nor any of their respective representatives is making or has made any representation or warranty, express or implied,
at law or in equity, in respect of the Parent, Merger Sub, the business, assets, liabilities, operations, prospects or condition (financial
or otherwise) of the Parent or Merger Sub, the nature or extent of any liabilities of the Parent or Merger Sub, the effectiveness or
the success of any operations of the Parent or Merger Sub or the accuracy or completeness of any confidential information memoranda,
projections, forecasts or estimates of earnings, or other information (financial or otherwise) regarding the Parent or Merger Sub furnished
to the Company, DLQ Parent or their respective representatives or made available to the Company, DLQ Parent and their representatives
in any “data rooms,” “virtual data rooms,” management presentations or any other form in expectation of, or in
connection with, the transactions contemplated hereby, or in respect of any other matter or thing whatsoever; and (ii) no representative
of the Parent or Merger Sub has any authority, express or implied, to make any representations, warranties or agreements not specifically
set forth in ARTICLE V and subject to the limited remedies herein provided; (b) the Company specifically disclaims that
it is relying upon or has relied upon any such other representations or warranties that may have been made by any Person, and acknowledges
and agrees that the Parent and the Merger Sub have specifically disclaimed and do hereby specifically disclaim any such other representation
or warranty made by any Person; and (c) none of the Parent, Merger Sub nor any other Person shall have any liability to the Company,
DLQ Parent or any other Person with respect to any such other representations or warranties, including projections, forecasts, estimates,
plans or budgets of future revenue, expenses or expenditures, future results of operations, future cash flows or the future financial
condition of the Parent or the future business, operations or affairs of the Parent.
12.15 Waiver
of Jury Trial. THE PARTIES EACH HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY RIGHT TO TRIAL BY JURY OF ANY PROCEEDING
(I) ARISING UNDER THIS AGREEMENT OR UNDER ANY ADDITIONAL AGREEMENT OR (II) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS
OF THE PARTIES IN RESPECT OF THIS AGREEMENT OR ANY ADDITIONAL AGREEMENT OR ANY OF THE TRANSACTIONS RELATED HERETO OR THERETO OR ANY FINANCING
IN CONNECTION WITH THE TRANSACTIONS CONTEMPLATED HEREBY OR ANY OF THE TRANSACTIONS CONTEMPLATED THEREBY, IN EACH CASE, WHETHER NOW EXISTING
OR HEREAFTER ARISING, AND WHETHER IN CONTRACT, TORT, EQUITY, OR OTHERWISE. THE PARTIES EACH HEREBY AGREES AND CONSENTS THAT ANY SUCH PROCEEDING
SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY AND THAT THE PARTIES MAY FILE AN ORIGINAL COUNTERPART OF A COPY OF THIS AGREEMENT WITH
ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY. EACH PARTY CERTIFIES
AND ACKNOWLEDGES THAT (A) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER
PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (B) EACH SUCH PARTY UNDERSTANDS AND HAS CONSIDERED
THE IMPLICATIONS OF THIS WAIVER, (C) EACH SUCH PARTY MAKES THIS WAIVER VOLUNTARILY AND (D) EACH SUCH PARTY HAS BEEN INDUCED TO ENTER INTO
THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 12.15.
12.16 Submission
to Jurisdiction. Subject to the provisions of Section 12.17, each of the Parties irrevocably and unconditionally submits
to the exclusive jurisdiction of the state and federal courts located in the City of New York (or any appellate courts thereof), for the
purposes of any Action (a) arising under this Agreement or under any Additional Agreement or (b) in any way connected with or related
or incidental to the dealings of the Parties in respect of this Agreement or any Additional Agreement or any of the transactions contemplated
hereby or thereby, and irrevocably and unconditionally waives any objection to the laying of venue of any such Action in any such court,
and further irrevocably and unconditionally waives and agrees not to plead or claim in any such court that any such Action has been brought
in an inconvenient forum. Each Party hereby irrevocably and unconditionally waives, and agrees not to assert, by way of motion or as a
defense, counterclaim or otherwise, in any Action (i) arising under this Agreement or under any Additional Agreement or (ii) in any way
connected with or related or incidental to the dealings of the Parties in respect of this Agreement or any Additional Agreement or any
of the transactions contemplated hereby or thereby, (A) any claim that it is not personally subject to the jurisdiction of the courts
as described in this Section 12.16 for any reason, (B) that it or its property is exempt or immune from the jurisdiction
of any such court or from any Action commenced in such courts (whether through service of notice, attachment prior to judgment, attachment
in aid of execution of judgment, execution of judgment or otherwise) and (C) that (x) the Action in any such court is brought in an inconvenient
forum, (y) the venue of such Action is improper or (z) this Agreement, or the subject matter hereof, may not be enforced in or by such
courts. Each Party agrees that service of any process, summons, notice or document by registered mail to such Party’s respective
address set forth in Section 12.1 shall be effective service of process for any such Action.
12.17 Arbitration.
Any and all disputes, controversies and claims (other than applications for a temporary restraining order, preliminary injunction, permanent
injunction or other equitable relief or application for enforcement of a resolution under this Section 12.17), arising out
of, related to, or in connection with this Agreement or the transactions contemplated hereby (a “Dispute”) shall be
governed by this Section 12.17. A party must, in the first instance, provide written notice of any Disputes to the other parties
subject to such Dispute, which notice must provide a reasonably detailed description of the matters subject to the Dispute. The parties
involved in such Dispute shall seek to resolve the Dispute on an amicable basis within ten (10) Business Days of the notice of such Dispute
being received by such other parties subject to such Dispute (the “Resolution Period”); provided, that
if any Dispute would reasonably be expected to have become moot or otherwise irrelevant if not decided within sixty (60) days after the
occurrence of such Dispute, then there shall be no Resolution Period with respect to such Dispute. Any Dispute that is not resolved during
the Resolution Period or any Dispute not subject to a Resolution Period may immediately be referred to the American Arbitration Association
(the “AAA”) and finally resolved by arbitration pursuant to the then-existing Expedited Procedures (as defined in the
AAA Procedures) of the Commercial Arbitration Rules (the “AAA Procedures”) of the AAA. Any party involved in such Dispute
may submit the Dispute to the AAA to commence the proceedings after the Resolution Period. To the extent that the AAA Procedures and this
Agreement are in conflict, the terms of this Agreement shall control. The arbitration shall be conducted by one arbitrator nominated by
the AAA promptly (but in any event within five (5) Business Days) after the submission of the Dispute to the AAA and reasonably acceptable
to each party subject to the Dispute, which arbitrator shall be a commercial lawyer with substantial experience arbitrating disputes under
acquisition agreements. The arbitrator shall accept his or her appointment and begin the arbitration process promptly (but in any event
within five (5) Business Days) after his or her nomination and acceptance by the parties subject to the Dispute. The proceedings shall
be streamlined and efficient. The arbitrator shall decide the Dispute in accordance with the substantive law of the State of Delaware.
Time is of the essence. Each party subject to the Dispute shall submit a proposal for resolution of the Dispute to the arbitrator within
twenty (20) days after confirmation of the appointment of the arbitrator. The arbitrator shall have the power to order any party to do,
or to refrain from doing, anything consistent with this Agreement, the Additional Agreements and applicable Law, including to perform
its contractual obligation(s); provided, that the arbitrator shall be limited to ordering pursuant to the foregoing power
(and, for the avoidance of doubt, shall order) the relevant party (or parties, as applicable) to comply with only one or the other of
the proposals. The arbitrator’s award shall be in writing and shall include a reasonable explanation of the arbitrator’s reason(s)
for selecting one or the other proposal. The arbitration shall take place in the State of New York. The language of the arbitration shall
be English.
12.18 Remedies.
Except as otherwise expressly provided herein, any and all remedies provided herein will be deemed cumulative with and not exclusive of
any other remedy conferred hereby, or by law or equity upon such party, and the exercise by a party of any one remedy will not preclude
the exercise of any other remedy. The parties agree that irreparable damage for which monetary damages, even if available, would not be
an adequate remedy, would occur in the event that the parties do not perform their respective obligations under the provisions of this
Agreement (including failing to take such actions as are required of them hereunder to consummate the transactions contemplated by this
Agreement) in accordance with their specific terms or otherwise breach such provisions. It is accordingly agreed that the parties shall
be entitled to an injunction or injunctions, specific performance and other equitable relief to prevent breaches of this Agreement and
to enforce specifically the terms and provisions of this Agreement, in each case, without posting a bond or undertaking and without proof
of damages and this being in addition to any other remedy to which they are entitled at law or in equity. Each of the parties agrees that
it will not oppose the granting of an injunction, specific performance and other equitable relief when expressly available pursuant to
the terms of this Agreement on the basis that the other parties have an adequate remedy at law or an award of specific performance is
not an appropriate remedy for any reason at law or equity.
12.19 Non-Recourse.
This Agreement may be enforced only against, and any dispute, claim or controversy based upon, arising out of or related to this Agreement
or the transactions contemplated hereby may be brought only against, the entities that are expressly named as parties hereto and then
only with respect to the specific obligations set forth in this Agreement with respect to such party. No past, present or future director,
officer, employee, incorporator, member, partner, shareholder, agent, attorney, advisor, lender or representative or Affiliate of any
named party to this Agreement (which Persons are intended third party beneficiaries of this Section 12.19) shall have any
liability (whether in contract or tort, at law or in equity or otherwise, or based upon any theory that seeks to impose liability of an
entity party against its owners or Affiliates) for any one or more of the representations, warranties, covenants, agreements or other
obligations or liabilities of such named party or, except as specifically set forth herein, for any dispute, claim or controversy based
on, arising out of, or related to this Agreement or the transactions contemplated hereby.
12.20 Attorney-Client
Privilege. Parent and the Surviving Corporation understand and agree that DLQ Parent will be entitled to retain the services of Procopio,
Cory, Hargreaves & Savitch LLP (“PCHS”) as counsel in the event of any dispute between Parent and the Surviving
Corporation and DLQ Parent concerning this Agreement, the Additional Agreements or the transactions contemplated hereby, notwithstanding
PCHS’ prior representation of the Company. Notwithstanding the consummation of the Merger, Parent and the Surviving Corporation
agree that neither the Surviving Corporation nor Parent shall have the right to assert the attorney/client privilege as to pre-closing
communications between any member of the Company Group or DLQ Parent (for the Company Group, only with respect to pre-closing communications),
on one hand, and its counsel, PCHS, on the other hand, to the extent that the privileged communications relates in substantial part to
this Agreement, the Additional Agreements or the transactions contemplated hereby. The parties agree that only DLQ Parent shall be entitled
to assert such attorney/client privilege in connection with communications following the Closing. Such privileged portions of the files
generated and maintained by PCHS in connection with the representation by PCHS of the Company with respect to this Agreement, the Additional
Agreements or the transactions contemplated hereby shall remain the exclusive property of DLQ Parent. All other files generated or maintained
by PCHS as a result of the representation by PCHS of the Company Group on any other matter (if any), remain the exclusive property of
the Company Group and shall be promptly delivered to Parent immediately upon request at any time after the Effective Time. Parent and
the Surviving Corporation further acknowledge and agree that (i) DLQ Parent is not waiving, and will not be deemed to have waived or diminished,
any of its attorney work product protections, attorney-client privileges or similar protections and privileges with respect to email that
was sent to or received from (as applicable) PCHS, including all attachments to such sent or received emails solely in their capacity
as attachments to such emails, stored in any digital format on any device at any location under the control of the Company Group; and
(ii) they shall provide the DLQ Parent reasonable access during normal business hours to such emails, information and/or materials located
on the servers of the Company Group and permit DLQ Parent to (x)remove such emails, information and/or materials from the servers of the
Company Group, and (y) download a digital copy all such emails, information and/or materials.
{The remainder of this
page intentionally left blank; signature pages to follow}
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the day and year first above written.
| |
Parent: |
| |
|
| |
ABRI SPAC I, INC. |
| |
|
| |
By: |
/s/ Jeffrey Tirman |
| |
|
Name: |
Jeffrey Tirman |
| |
|
Title: |
Chief Executive Officer |
| |
|
|
|
| |
Merger Sub: |
| |
|
| |
ABRI MERGER SUB, INC. |
| |
|
| |
By: |
/s/ Jeffrey Tirman |
| |
|
Name: |
Jeffrey Tirman |
| |
|
Title: |
Director |
| |
|
|
|
| |
Company: |
| |
|
| |
DLQ, INC. |
| |
|
| |
By: |
/s/ Brent Suen |
| |
|
Name: |
Brent Suen |
| |
|
Title: |
Chief Executive Officer |
| |
|
|
|
| |
DLQ Parent: |
| |
|
| |
LOGIQ, INC. |
| |
|
| |
By: |
/s/ Brent Suen |
| |
|
Name: |
Brent Suen |
| |
|
Title: |
Chief Executive Officer |
{Signature page to
Merger Agreement}
Exhibit A
PARENT STOCKHOLDER
SUPPORT AGREEMENT
This
PARENT STOCKHOLDER SUPPORT AGREEMENT, dated as of September 9, 2022 (this “Parent Support Agreement”), is entered
into by and among the stockholder named on the signature page hereto (the “Stockholder”), DLQ, Inc., a Nevada
corporation (the “Company”), and Abri SPAC I, Inc., a Delaware corporation (“Parent”).
Capitalized terms used but not defined in this Parent Support Agreement shall have the meanings ascribed to them in the Merger Agreement
(as defined below).
WHEREAS,
Parent, Abri Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of Parent (“Merger Sub”),
the Company, and Logiq, Inc., the parent of the Company are parties to that certain Merger Agreement, dated as of the date hereof (as
amended, modified or supplemented from time to time, the “Merger Agreement”), which provides, among other things,
that, upon the terms and subject to the conditions thereof, Merger Sub will be merged with and into the Company (the “Merger”),
with the Company surviving the Merger as a direct wholly-owned subsidiary of Parent, and as a result of which, among other matters, all
of the issued and outstanding capital stock of the Company as of the Effective Time shall no longer be outstanding and shall automatically
be cancelled and shall cease to exist, in exchange for the right to receive the Closing Merger Consideration Shares as set forth in the
Merger Agreement, all upon the terms and subject to the conditions set forth in the Merger Agreement and in accordance with the applicable
provisions of the DGCL;
WHEREAS,
as of the date hereof, the Stockholder owns the number of shares of Parent’s common stock, par value $0.0001 (“Parent
Common Stock”), as set forth underneath Stockholder’s name on the signature page hereto (all such shares, or any successor
or additional shares of Parent of which ownership of record or the power to vote is hereafter acquired by the Stockholder prior to the
termination of this Parent Support Agreement being referred to herein as the “Stockholder Shares”);
WHEREAS,
the Board of Directors of Parent has (a) approved the execution, delivery and performance by Parent and Merger Sub of the Merger Agreement,
the Additional Agreements to which it is a party and the Merger and the other transactions contemplated by any such documents (collectively,
the “Transactions”), (b) determined that the Transactions are advisable and in the best interests of Parent
and its stockholders (the “Parent Stockholders”) and (c) recommended the approval and the adoption by the Parent
Stockholders of the Merger Agreement, the Additional Agreements, the Merger and the other Transactions; and
WHEREAS,
in order to induce the Company, to enter into the Merger Agreement, Stockholder is executing and delivering this Parent Support Agreement
to the Company.
NOW,
THEREFORE, in consideration of the foregoing and of the mutual covenants and agreements contained herein, and intending to be legally
bound hereby, the parties hereby agree as follows:
1. Voting
Agreements. Stockholder, solely in its capacity as a stockholder of Parent, agrees that, during the term of this Parent Support Agreement,
at the Parent Stockholder Meeting, at any other meeting of the Parent Stockholders related to the Transactions (whether annual or special
and whether or not an adjourned or postponed meeting, however called and including any adjournment or postponement thereof) and/or in
connection with any written consent of the Parent Stockholders related to the Transactions (the Parent Stockholder Meeting and all other
meetings or consents related to the Merger Agreement and/or the Transactions collectively referred to herein as the “Meeting”),
Stockholder shall:
(a)
when the Meeting is held, appear at the Meeting or otherwise cause the Stockholder Shares to be counted as present thereat for the purpose
of establishing a quorum;
(b)
vote or cause to be voted at the Meeting (or validly execute and return an action by written consent or an action to cause such consent
to be granted with respect to) all of the Stockholder Shares in favor of all Parent Proposals, including approval of the Merger Agreement
and the Transactions; and
(c) vote or cause
to be voted at the Meeting (or validly execute and return an action by written consent or an action to cause such consent to be granted
with respect to) all of the Stockholder Shares against any other action that would reasonably be expected to (x) materially impede, interfere
with, delay, postpone or adversely affect the Merger or any of the Transactions, (y) result in a breach of any covenant, representation
or warranty or other obligation or agreement of Parent under the Merger Agreement or (z) result in a breach of any covenant, representation
or warranty or other obligation or agreement of the Stockholder contained in this Parent Support Agreement.
2. Restrictions
on Transfer. The Stockholder agrees that, during the term of this Parent Support Agreement, it shall not sell, assign or otherwise
transfer any of the Stockholder Shares unless the buyer, assignee or transferee thereof executes a joinder agreement to this Parent Support
Agreement in a form reasonably acceptable to the Company and Parent. Parent shall not, and shall not permit Parent’s transfer agent
to, register any sale, assignment or transfer of the Stockholder Shares on Parent’s stock ledger (book entry or otherwise) that
is not in compliance with this Section 2.
3. No
Redemption. Stockholder hereby agrees that, during the term of this Agreement, it shall not redeem, or submit a request to Parent’s
transfer agent or otherwise exercise any right to redeem, any Stockholder Shares.
4. New
Securities. During the term of this Parent Support Agreement, in the event that, (a) any shares of Parent Common Stock or other equity
securities of Parent are issued to the Stockholder after the date of this Parent Support Agreement pursuant to any stock dividend, stock
split, recapitalization, reclassification, combination or exchange of Parent securities owned by the Stockholder, (b) the Stockholder
purchases or otherwise acquires beneficial ownership of any shares of Parent Common Stock or other equity securities of Parent after the
date of this Parent Support Agreement, or (c) the Stockholder acquires the right to vote or share in the voting of any Parent Common Stock
or other equity securities of Parent after the date of this Parent Support Agreement (such Parent Common Stock or other equity securities
of Parent, collectively the “New Securities”), then such New Securities acquired or purchased by the Stockholder
shall be subject to the terms of this Parent Support Agreement to the same extent as if they constituted the Stockholder Shares as of
the date hereof.
5. No
Challenge. Stockholder agrees not to commence, join in, facilitate, assist or encourage, and agrees to take all actions necessary
to opt out of any class in any class action with respect to, any claim, derivative or otherwise, against Parent, Merger Sub, the Company
or any of their respective successors or directors (a) challenging the validity of, or seeking to enjoin the operation of, any provision
of this Parent Support Agreement or (b) alleging a breach of any fiduciary duty of any Person in connection with the evaluation, negotiation
or entry into the Merger Agreement.
6. Waiver.
Stockholder hereby irrevocably and unconditionally waives, and agrees not to exercise, any rights of appraisal, dissenter’s rights
and any similar rights under applicable law (including Section 262 of the DGCL) relating to the Merger and the consummation of the Transactions,
including any notice requirements.
7. Consent
to Disclosure. Stockholder hereby consents to the publication and disclosure in the Form S-4 and the Proxy Statement (and, as and
to the extent otherwise required by applicable securities Laws or the SEC or any other securities authorities, any other documents or
communications provided by Parent or the Company to any Authority or to securityholders of Parent or the Company) of Stockholder’s
identity and beneficial ownership of Stockholder Shares and the nature of Stockholder’s commitments, arrangements and understandings
under and relating to this Parent Support Agreement and, if deemed appropriate by Parent or the Company, a copy of this Parent Support
Agreement. Stockholder will promptly provide any information reasonably requested by Parent or the Company for any regulatory application
or filing made or approval sought in connection with the Transactions (including filings with the SEC). Stockholder shall not issue any
press release or otherwise make any public statements with respect to the Transactions or the transactions contemplated herein without
the prior written approval of the Company and Parent.
8. Stockholder
Representations: Stockholder represents and warrants to Parent and the Company, as of the date hereof, that:
(a)
Stockholder has never been suspended or expelled from membership in any securities or commodities exchange or association or had a securities
or commodities license or registration denied, suspended or revoked;
(b)
Stockholder has full right and power, without violating any agreement to which it is bound (including any non-competition or non-solicitation
agreement with any employer or former employer), to enter into this Parent Support Agreement;
(c)
(i) if Stockholder is not an individual, Stockholder is duly organized, validly existing and in good standing under the Laws of the jurisdiction
in which it is organized, and the execution, delivery and performance of this Parent Support Agreement and the consummation of the transactions
contemplated hereby are within the Stockholder’s organizational powers and have been duly authorized by all necessary organizational
actions on the part of the Stockholder and (ii) if Stockholder is an individual, the signature on this Parent Support Agreement is genuine,
and Stockholder has legal competence and capacity to execute the same;
(d)
this Parent Support Agreement has been duly executed and delivered by Stockholder and, assuming due authorization, execution and delivery
by the other parties to this Parent Support Agreement, this Parent Support Agreement constitutes a legally valid and binding obligation
of Stockholder, enforceable against Stockholder in accordance with the terms hereof (except as enforceability may be limited by bankruptcy
Laws, other similar Laws affecting creditors’ rights and general principles of equity affecting the availability of specific performance
and other equitable remedies);
(e)
the execution and delivery of this Parent Support Agreement by Stockholder does not, and the performance by Stockholder of its obligations
hereunder will not, (i) if Stockholder is not an individual, conflict with or result in a violation of the organizational documents of
Stockholder, or (ii) require any consent or approval from any third party that has not been given or other action that has not been taken
by any third party, in each case, to the extent such consent, approval or other action would prevent, enjoin or materially delay the performance
by Stockholder of its obligations under this Parent Support Agreement;
(f)
there are no Actions pending against Stockholder or, to the knowledge of Stockholder, threatened against Stockholder, before (or, in the
case of threatened Actions, that would be before) any Authority, which in any manner challenges or seeks to prevent, enjoin or materially
delay the performance by Stockholder of Stockholder’s obligations under this Parent Support Agreement;
(g)
no broker, finder, investment banker or other Person is entitled to any brokerage fee, finders’ fee or other commission in connection
with this Parent Support Agreement or any of the respective transactions contemplated hereby, based upon arrangements made by or on behalf
of the Stockholder;
(h)
Stockholder has had the opportunity to read the Merger Agreement and this Parent Support Agreement and has had the opportunity to consult
with Stockholder’s tax and legal advisors;
(i)
Stockholder has not entered into, and shall not enter into, any agreement that would prevent Stockholder from performing any of Stockholder’s
obligations hereunder;
(j)
Stockholder has good title to the Stockholder Shares underneath Stockholder’s name on the signature page hereto, free and clear
of any Liens other than Permitted Liens and Liens under Parent’s Certificate of Incorporation and/or Bylaws, and Stockholder has
the sole power to vote or cause to be voted the Stockholder Shares; and
(k)
the Stockholder Shares set forth underneath Stockholder’s name on the signature page to this Parent Support Agreement are the only
shares of Parent’s outstanding capital stock owned of record or beneficially owned by the Stockholder as of the date hereof, and
none of the Stockholder Shares are subject to any proxy, voting trust or other agreement or arrangement with respect to the voting of
the Stockholder Shares that is inconsistent with Stockholder’s obligations pursuant to this Parent Support Agreement.
9. Specific
Performance. The Stockholder hereby agrees and acknowledges that (a) Parent and the Company would be irreparably injured in the event
of a breach by the Stockholder of its obligations under this Parent Support Agreement, (b) monetary damages may not be an adequate remedy
for such breach and (c) Parent and the Company shall be entitled to obtain injunctive relief, in addition to any other remedy that such
party may have in law or in equity, in the event of such breach or anticipated breach, without the requirement to post any bond or other
security or to prove that money damages would be inadequate.
10. Entire
Agreement; Amendment; Waiver. This Parent Support Agreement and the other agreements referenced herein constitute the entire agreement
and understanding of the parties hereto in respect of the subject matter hereof and supersede all prior understandings, agreements or
representations by or among the parties hereto, written or oral, to the extent they relate in any way to the subject matter hereof or
the transactions contemplated hereby provided, that, for the avoidance of doubt, the foregoing shall not affect the rights and obligations
of the parties under the Merger Agreement or any Additional Agreement. This Parent Support Agreement may not be changed, amended, modified
or waived (other than to correct a typographical error) as to any particular provision, except by a written instrument executed by all
parties hereto. No failure or delay by a party in exercising any right hereunder shall operate as a waiver thereof. No waivers of or exceptions
to any term, condition, or provision of this Parent Support Agreement, in any one or more instances, shall be deemed to be or construed
as a further or continuing waiver of any such term, condition, or provision.
11. Binding
Effect; Assignment; Third Parties. This Parent Support Agreement and all of the provisions hereof shall be binding upon and inure
to the benefit of the parties hereto and their respective permitted successors and assigns. This Parent Support Agreement and all obligations
of Stockholder are personal to Stockholder and may not be assigned, transferred or delegated by Stockholder at any time without the prior
written consent of Parent and the Company, and any purported assignment, transfer or delegation without such consent shall be null and
void ab initio. Nothing contained in this Parent Support Agreement or in any instrument or document executed by any party in connection
with the transactions contemplated hereby shall create any rights in, or be deemed to have been executed for the benefit of, any Person
that is not a party hereto or thereto or a successor or permitted assign of such a party.
12. Counterparts.
This Parent Support Agreement may be executed in any number of original, electronic 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.
13. Severability.
This Parent Support 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 Parent Support 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 Parent Support
Agreement a provision as similar in terms to such invalid or unenforceable provision as may be possible and be valid and enforceable.
14. Governing
Law; Jurisdiction; Jury Trial Waiver. Sections 12.7 (Governing Law), 12.15 (Waiver of Jury Trial), 12.16 (Submission to Jurisdiction)
and 12.18 (Remedies) of the Merger Agreement are incorporated by reference herein to apply with full force to any disputes arising under
this Parent Support Agreement.
15. Notice.
Any notice, consent or request to be given in connection with any of the terms or provisions of this Parent Support Agreement shall be
in writing and shall be sent or given in accordance with the terms of Section 12.1 (Notices) of the Merger Agreement to the applicable
party, with respect to the Company and Parent, at the respective addresses set forth in Section 12.1 of the Merger Agreement, and, with
respect to the Stockholder, at the address set forth underneath Stockholder’s name on the signature page hereto.
16. Termination.
This Parent Support Agreement shall become effective upon the date hereof and shall automatically terminate, and none of Parent, the Company
or Stockholder shall have any rights or obligations hereunder, on the earliest of (i) the mutual written consent of Parent, the Company
and the Stockholder, (ii) the Closing (following the performance of the obligations of the parties hereunder required to be performed
at or prior to the Closing), or (iii) the termination of the Merger Agreement in accordance with its terms. No such termination shall
relieve the Stockholder, Parent or the Company from any liability resulting from a breach of this Parent Support Agreement occurring prior
to such termination. Notwithstanding anything to the contrary herein, the provisions of this Section 16 shall survive
the termination of this Parent Support Agreement.
17. Further
Actions. Each of the parties hereto agrees to execute and deliver hereafter any further document, agreement or instrument of assignment,
transfer or conveyance as may be necessary or desirable to effectuate the purposes hereof and as may be reasonably requested in writing
by another party hereto.
18. Expenses.
Each party shall be responsible for its own fees and expenses (including the fees and expenses of investment bankers, accountants and
counsel) in connection with the entering into of this Parent Support Agreement, the performance of its obligations hereunder and the consummation
of the transactions contemplated hereby; provided, that in the event of any Action arising out of or relating to this Parent Support Agreement,
the non-prevailing party in any such Action will pay its own expenses and the reasonable documented out-of-pocket expenses, including
reasonable attorneys’ fees and costs, reasonably incurred by the prevailing party.
19. Interpretation.
The titles and subtitles used in this Parent Support Agreement are for convenience only and are not to be considered in construing or
interpreting this Parent Support Agreement. In this Parent Support Agreement, unless the context otherwise requires: (i) any pronoun
used shall include the corresponding masculine, feminine or neuter forms, and the singular form of nouns, pronouns and verbs shall include
the plural and vice versa; (ii) the term “including” (and with correlative meaning “include”) shall be deemed
in each case to be followed by the words “without limitation”; and (iii) the words “herein,” “hereto,”
and “hereby” and other words of similar import shall be deemed in each case to refer to this Parent Support Agreement as
a whole and not to any particular section or other subdivision of this Parent Support Agreement. The parties have participated jointly
in the negotiation and drafting of this Parent Support Agreement. Consequently, in the event an ambiguity or question of intent or interpretation
arises, this Parent Support Agreement shall be construed as if drafted jointly by the parties hereto, and no presumption or burden of
proof shall arise favoring or disfavoring any party by virtue of the authorship of any provision of this Parent Support Agreement.
20. No
Partnership, Agency or Joint Venture. This Parent Support Agreement is intended to create a contractual relationship among Stockholder,
the Company and Parent, and is not intended to create, and does not create, any agency, partnership, joint venture or any like relationship
among the parties hereto or among any other Parent Stockholders entering into support agreements with the Company or Parent. Stockholder
has acted independently regarding its decision to enter into this Parent Support Agreement. Nothing contained in this Parent Support Agreement
shall be deemed to vest in the Company or Parent any direct or indirect ownership or incidence of ownership of or with respect to any
Stockholder Shares. All rights, ownership and economic benefits of and relating to the Stockholder Shares shall remain vested in and belong
to Stockholder, and neither Company nor Parent shall have any authority to direct Stockholder in the voting or disposition of any Stockholder
Shares, except as otherwise provided herein.
21. Capacity
as Stockholder. Stockholder signs this Parent Support Agreement solely in Stockholder’s capacity as a stockholder of Parent,
and not in any other capacity, including, if applicable, as a director (including “director by deputization”), officer or
employee of Parent or any of its Subsidiaries. Nothing herein shall be construed to limit or affect any actions or inactions by Stockholder
or any representative of Stockholder, as applicable, serving as a director of Parent or any Subsidiary of Parent, acting in such Person’s
capacity as a director of Parent or any Subsidiary of Parent.
{remainder of page
intentionally left blank}
IN
WITNESS WHEREOF, the parties have executed this Parent Support Agreement as of the date first written above.
| |
The Company: |
| |
|
| |
DLQ, INC. |
| |
|
| |
By: |
/s/ Brent Suen |
| |
Name: |
Brent Suen |
| |
Title: |
Chief Executive Officer |
| |
|
|
| |
Parent: |
| |
|
| |
ABRI SPAC I, INC. |
| |
|
| |
By: |
/s/ Jeffrey Tirman |
| |
Name: |
Jeffrey Tirman |
| |
Title: |
Chief Executive Officer |
{Signature Page
to Parent Stockholder Support Agreement}
| Stockholder: |
|
|
| |
|
|
| ABRI VENTURES I, LLC |
|
|
| |
|
|
| By: |
|
/s/ Jeffrey Tirman |
|
|
| Name: |
|
Jeffrey Tirman |
|
|
| Title: |
|
Managing Member |
|
|
Number of Shares:
Shares of Parent Common
Stock: 1,728,078
Address for Notice:
Abri Ventures I, LLC.
9663 Santa Monica Blvd., No. 1091
Beverly Hills, CA 90210
Attn: Jeffrey Tirman, Managing Member
{Signature Page to Parent Stockholder
Support Agreement}
Exhibit B
FORM OF
MANAGEMENT EARNOUT AGREEMENT
This
Management Earnout Agreement (this “Agreement”), dated as of [●], 2022, is entered into by and among each
member of management of DLQ, Inc. set forth on Exhibit A (the “Management Members”), and Abri SPAC I, Inc.,
a Delaware corporation (“Parent”). The Management Members and Parent are sometimes referred to herein each as
a “Party” and together the “Parties”.
Recitals
WHEREAS,
Parent, Abri Merger Sub, Inc., a Delaware corporation (“Merger Sub”), DLQ, Inc., a Nevada corporation (the “Company”),
and Logiq, Inc., a Delaware corporation (the “DLQ Parent”) have entered into a Merger Agreement (the “Merger
Agreement”; capitalized terms used but not defined herein shall have their respective meanings assigned to them in the Merger
Agreement), dated as of September 9, 2022, pursuant to which Merger Sub will merge with and into the Company (the “Merger”)
and the Company will be the surviving company and a wholly-owned subsidiary of Parent; and
WHEREAS,
as a condition and an inducement to Parent and the Company entering into the Merger Agreement, the Management Members and Parent have
agreed that an aggregate of 2,000,000 shares of Parent Common Stock (collectively, the “Management Earnout Shares”)
will be issued to the Management Members in the amounts set forth on Schedule A free and clear of all Liens.
NOW,
THEREFORE, in consideration of the premises, representations, warranties and the mutual covenants contained in this Agreement, and for
other good and valuable consideration, the receipt, sufficiency and adequacy of which are hereby acknowledged, the Parties agree as follows:
Agreement
1. Definitions. For
purposes hereof, the following terms when used in this Agreement shall have the respective meanings set forth below:
“Earnout
Period” means the First Earnout Period, the Second Earnout Period and the Third Earnout Period, as applicable.
“First
Earnout Period” means the period from and after the Closing until the first anniversary of the Closing Date.
“First
Milestone Event” means the occurrence of the following event: the closing share price of the shares of Parent Common Stock over
any twenty (20) consecutive Trading Days during the First Earnout Period is greater than or equal to $16.50 per share (subject to any
adjustment pursuant to Section 3(c)).
“Milestone
Event” means any of the First Milestone Event, Second Milestone Event and Third Milestone Event.
“Second
Earnout Period” means the period from and after the Closing until the second anniversary of the Closing Date.
“Second
Milestone Event” means the occurrence of the following event: the closing share price of the shares of Parent Common Stock over
any twenty (20) consecutive Trading Days during the Second Earnout Period is greater than or equal to $23.00 per share (subject to any
adjustment pursuant to Section 3(c)).
“Third
Earnout Period” means the period from and after the Closing until the third anniversary of the Closing Date.
“Third
Milestone Event” means the occurrence of the following event: the closing share price of the shares of Parent Common Stock over
any twenty (20) consecutive Trading Days during the Third Earnout Period is greater than or equal to $30.00 per share (subject to any
adjustment pursuant to Section 3(c)).
2. Issuance
and Release of the Management Earnout Shares.
(a) The
Parties acknowledge and agree that the Management Earnout Shares shall be: issued by Parent to the Management Members in the amounts set
forth on Exhibit A, as additional consideration for the Merger, free and clear of all Liens other than applicable federal and state securities
restrictions):
(i) 500,000
Management Earnout Shares shall be earned upon satisfaction of the First Milestone Event;
(ii) 650,000
Management Earnout Shares shall be earned upon satisfaction of the Second Milestone Event; and
(iii) 850,000
Management Earnout Shares shall be earned upon satisfaction of the Third Milestone Event.
Any Management Earnout
Shares that are not earned on or before the expiration of the applicable Earnout Period shall be forfeited and cancelled.
(b) For
the avoidance of doubt: (i) more than one of the Milestone Events described in Sections 2(a) may occur at the same time
if occurring during the portion of the Earnout Period starting from and after the Closing Date and ending on the second anniversary of
the Closing Date; (ii) only the Milestone Events described in Sections 2(a) may occur during the portion of the Earnout
Period starting from and after the first anniversary of the Closing Date and ending on the second anniversary of the Closing Date; and
(iii) only the Milestone Event described in Section 2(a) may occur during the portion of the Earnout Period starting
from and after the second anniversary of the Closing Date and ending on the third anniversary of the Closing Date.
3. Covenants
of Parent.
(a) Promptly
after each Milestone Event has occurred (but in any event within ten (10) Business Days after the occurrence of the applicable Milestone
Event), Parent shall take all actions required to be taken by Parent to issue the applicable Management Earnout Shares to the Management
Members as detailed on Exhibit A.
(b) Parent
shall take such actions as are reasonably requested by the Management Members to evidence the issuances pursuant to Section 2(a),
including through the provision of an updated stock ledger showing such issuances (as certified by an officer of Parent responsible for
maintaining such ledger or the applicable registrar or transfer agent of Parent).
(c) In
the event Parent shall at any time during the Earnout Period pay any dividend on Parent Common Stock by the issuance of additional shares
of Parent Common Stock, or effect a subdivision or combination or consolidation of the outstanding Parent Common Stock (by reclassification
or otherwise) into a greater or lesser number of shares of Parent Common Stock, then in each such case, (i) the number of Management Earnout
Shares shall be adjusted by multiplying such amount by a fraction, the numerator of which is the number of shares of Parent Common Stock
(including any other shares so reclassified as Parent Common Stock) outstanding immediately after such event and the denominator of which
is the number of shares of Parent Common Stock that were outstanding immediately prior to such event, and (ii) the dollar values set forth
in Sections 2(a) and Sections 4(a)-(c) shall be appropriately adjusted to provide to the Management
Members the same economic effect as contemplated by this Agreement prior to such event.
(d) During
the Earnout Period, Parent shall take all reasonable efforts for Parent to remain listed as a public company on, and for the Parent Common
Stock to be tradable over, Nasdaq; provided, however, that the foregoing shall not limit Parent from consummating a Change in Control
or entering into a Contract that contemplates a Change in Control. Upon the consummation of any Change in Control during the Earnout Period,
other than as set forth in Section 4, Parent shall have no further obligations pursuant to this Section 3(d).
(e) Except
with respect to any amounts treated as imputed interest under Section 483 of the Code, any issuance of shares of Management Earnout Shares
pursuant to this Agreement shall be treated as an adjustment to the merger consideration by the Parties for Tax purposes, unless otherwise
required by a change in applicable Tax Law. Any Management Earnout Share that is issued pursuant to this Agreement shall be treated as
eligible for non-recognition treatment under Section 354 of the Code (and shall not be treated as “other property” within
the meaning of Section 356 of the Code).
4.
Change in Control. If, at any time after the Closing and prior to or on the third (3rd) anniversary of the Closing
Date, there occurs any transaction resulting in a Change in Control, and the per share valuation of Parent Common Stock in such Change
in Control transaction prior to giving effect to the provisions of this Section 4 is: (a) greater than or equal to $16.50, then,
immediately prior to the consummation of such Change in Control, the Milestone Event set forth in Section 2(i) shall
be deemed to have occurred if such Milestone Event shall not have previously occurred; (ii) greater than or equal to $23.00, then, immediately
prior to the consummation of such Change in Control, the Milestone Event set forth in Section 2(a)(ii) shall be
deemed to have occurred if such Milestone Event shall not have previously occurred; and (iii) greater than or equal to $30.00 then,
immediately prior to the consummation of such Change in Control, the Milestone Event set forth in Section 2(a)(iii) shall
be deemed to have occurred if such Milestone Event shall not have previously occurred (it being understood that such Change in Control
may result in the occurrence of more than one of the events as provided in clauses (i), (ii) and (iii)); provided, however, that, in each
case of clauses (i), (ii) and (iii), the applicable Management Earnout Shares shall be released to the Management Members as of immediately
prior to the Change in Control, and the Management Members shall be eligible to participate in such Change in Control transaction with
respect to such Management Earnout Shares.
5. Representations
and Warranties of Each Management Member. Each Management Member represents and warrants to Parent as follows:
(a) Authorization.
This Agreement, when executed and delivered by such Management Member, shall constitute the valid and legally binding obligation of such
Management Member, enforceable in accordance with its terms, except: (i) as limited by applicable bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance and any other laws of general application affecting enforcement of creditors’ rights generally;
or (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies.
(b) Governmental
Consents and Filings. No consent, approval, order or authorization of, or registration, qualification, designation, declaration or
filing with, any federal, state or local governmental authority is required on the part of such Management Member in connection with the
consummation of the transactions contemplated by this Agreement.
(c) Compliance
with Other Instruments. The execution, delivery and performance by each Management Member of this Agreement and the consummation by
such Management Member of the transactions contemplated by this Agreement will not result in any violation or default: (i) of any
instrument, judgment, order, writ or decree to which it is a party or by which it is bound; (ii) under any note, indenture or mortgage
to which it is a party or by which it is bound; (iii) under any lease, agreement, contract or purchase order to which it is a party or
by which it is bound; or (iv) of any provision of any federal or state statute, rule or regulation applicable to such Management Member,
in each case, which would have a material adverse effect on the Management Member or its ability to consummate the transactions contemplated
by this Agreement.
6. Representations
and Warranties of Parent. Parent represents and warrants to the Management Members as follows:
(a) Organization
and Corporate Power. Parent is duly organized, validly existing, and in good standing under the laws of the jurisdiction of its formation
and has all requisite power and authority to carry on its business as presently conducted and as proposed to be conducted.
(b) Authorization.
Parent has full power and authority to enter into this Agreement. This Agreement, when executed and delivered by Parent, shall constitute
the valid and legally binding obligation of Parent, enforceable against Parent in accordance with its terms except: (i) as limited by
applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, or other laws of general application relating to
or affecting the enforcement of creditors’ rights generally; or (ii) as limited by laws relating to the availability of specific
performance, injunctive relief, or other equitable remedies.
(c) Governmental
Consents and Filings. Assuming the accuracy of the representations and warranties made by the Management Members in this Agreement,
no consent, approval, order or authorization of, or registration, qualification, designation, declaration or filing with, any federal,
state or local governmental authority is required on the part of Parent in connection with the consummation of the transactions contemplated
by this Agreement.
(d) Compliance
with Other Instruments. The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated
by this Agreement will not result in any violation or default: (i) of any provisions of its certificate of incorporation or other governing
documents; (ii) of any instrument, judgment, order, writ or decree to which it is a party or by which it is bound; (iii) under any note,
indenture or mortgage to which it is a party or by which it is bound; (iv) under any lease, agreement, contract or purchase order to which
it is a party or by which it is bound; or (v) of any provision of any federal or state statute, rule or regulation applicable to Parent,
in each case (other than clause (i)) which would have a material adverse effect on Parent or its ability to consummate the transactions
contemplated by this Agreement.
7. General
Provisions.
(a) Notices.
Any notice hereunder shall be sent in writing, addressed as specified below, and shall be deemed given: (i) if by hand or nationally recognized
overnight courier service, by 5:00 PM Eastern Time on a Business Day, addressee’s day and time, on the date of delivery, and if
delivered after 5:00 PM Eastern Time, on the first Business Day after such delivery; (ii) if by electronic mail or facsimile, on the date
of transmission with affirmative confirmation of receipt; or (iii) three (3) Business Days after mailing by prepaid certified or registered
mail, return receipt requested. Notices shall be addressed to the respective Parties as follows, or to such other address as a Party shall
specify to the others in accordance with these notice provisions:
if
to Parent, to:
Abri SPAC I, Inc.
9663 Santa Monica Blvd., No. 1091
Beverly Hills, CA 90210
Attn: Jeffrey Tirman, Chief Executive Officer
E-mail: jtirman@abriadv.com
with a copy (which shall not constitute notice) to:
Loeb & Loeb LLP
345 Park Ave
New York, NY 10154
Attention: Mitchell S. Nussbaum
Fax: 212.504.3013
E-mail: mnussbaum@loeb.com
if
to a Management Member, to the address for such Management Member set forth on Exhibit A.
(b) Survival
of Representations and Warranties. All of the representations and warranties contained herein shall survive the Closing.
(c) Entire
Agreement. This Agreement, together with any documents, instruments and writings that are delivered pursuant hereto or referenced
herein, constitutes the entire agreement and understanding of the Parties in respect of its subject matter and supersedes all prior understandings,
agreements, or representations by or among the Parties, written or oral, to the extent they relate in any way to the subject matter hereof
or the transactions contemplated hereby.
(d) Successors.
All of the terms, agreements, covenants, representations, warranties, and conditions of this Agreement are binding upon, and inure to
the benefit of and are enforceable by, the Parties and their respective successors. Nothing in this Agreement, express or implied, is
intended to confer upon any Party other than the Parties or their respective successors and assigns any rights, remedies, obligations
or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement.
(e) Assignments.
Except as otherwise specifically provided herein, no Management Member may assign either this Agreement or any of its rights, interests,
or obligations hereunder without the prior written approval of the Parent.
(f) Counterparts.
This Agreement may be executed, by manual or electronic signature, in two or more counterparts, each of which will be deemed an original
but all of which together will constitute one and the same instrument.
(g) Headings.
The section headings contained in this Agreement are inserted for convenience only and will not affect in any way the meaning or interpretation
of this Agreement.
(h) Governing
Law. This Agreement, the entire relationship of the Parties, and any litigation between the Parties (whether grounded in contract,
tort, statute, law or equity) shall be governed by, construed in accordance with, and interpreted pursuant to the laws of the State of
Delaware, without giving effect to its choice of laws principles.
(i) Jurisdiction.
The Parties (i) hereby irrevocably and unconditionally submit to the jurisdiction of the federal and state courts of New York (or any
appellate courts thereof) for the purpose of any suit, action or other proceeding arising out of or based upon this Agreement, (b) agree
not to commence any suit, action or other proceeding arising out of or based upon this Agreement except in the federal and state courts
of New York, and (c) hereby waive, and agree not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or
proceeding, any claim that it is not subject personally to the jurisdiction of the above-named courts, that its property is exempt or
immune from attachment or execution, that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit,
action or proceeding is improper or that this Agreement or the subject matter hereof may not be enforced in or by such court.
(j) Waiver
of Jury Trial. The Parties hereby waive any right to a jury trial in connection with any litigation pursuant to this Agreement and
the transactions contemplated hereby.
(k) Amendments.
This Agreement may not be amended, modified or waived as to any particular provision, except with the written consent of Parent and a
majority-in-interest of the Management Members.
(l) Severability.
The provisions of this Agreement will be deemed severable and the invalidity or unenforceability of any provision will not affect the
validity or enforceability of the other provisions hereof; provided that if any provision of this Agreement, as applied to any Party or
to any circumstance, is adjudged by a governmental authority, arbitrator, or mediator not to be enforceable in accordance with its terms,
the Parties agree that the governmental authority, arbitrator, or mediator making such determination will have the power to modify the
provision in a manner consistent with its objectives such that it is enforceable, and/or to delete specific words or phrases, and in its
reduced form, such provision will then be enforceable and will be enforced.
(m) Expenses.
Parent will bear all of the costs and expenses incurred in connection with the preparation, execution and performance of this Agreement
and the consummation of the transactions contemplated hereby, including all fees and expenses of agents (including transfer agents), representatives,
financial advisors, legal counsel and accountants.
(n) Construction.
The Parties have participated jointly in the negotiation and drafting of this Agreement. If an ambiguity or question of intent or interpretation
arises, this Agreement will be construed as if drafted jointly by the Parties and no presumption or burden of proof will arise favoring
or disfavoring any Party because of the authorship of any provision of this Agreement. Any reference to any federal, state, local, or
foreign law will be deemed also to refer to such law as amended and all rules and regulations promulgated thereunder, unless the context
requires otherwise. The words “include,” “includes,” and “including” will be
deemed to be followed by “without limitation.” Pronouns in masculine, feminine, and neuter genders will be construed
to include any other gender, and words in the singular form will be construed to include the plural and vice versa, unless the context
otherwise requires. The words “this Agreement,” “herein,” “hereof,” “hereby,”
“hereunder,” and words of similar import refer to this Agreement as a whole and not to any particular subdivision unless
expressly so limited. The Parties intend that each representation, warranty, and covenant contained herein will have independent significance.
If any Party has breached any representation, warranty, or covenant contained herein in any respect, the fact that there exists another
representation, warranty or covenant relating to the same subject matter (regardless of the relative levels of specificity) which such
Party has not breached will not detract from or mitigate the fact that such Party is in breach of the first representation, warranty,
or covenant.
(o) Waiver.
No waiver by any Party of any default, misrepresentation, or breach of warranty or covenant hereunder, whether intentional or not, may
be deemed to extend to any prior or subsequent default, misrepresentation, or breach of warranty or covenant hereunder or affect in any
way any rights arising because of any prior or subsequent occurrence.
(p) Confidentiality.
Except as may be required by law, regulation or applicable stock exchange listing requirements, unless and until the transactions contemplated
hereby and the terms hereof are publicly announced or otherwise publicly disclosed by Parent, the Parties shall keep confidential and
shall not publicly disclose the existence or terms of this Agreement.
[Signature page follows]
IN
WITNESS WHEREOF, the undersigned have executed this Agreement to be effective as of the date first set forth above.
| |
ABRI SPAC I, INC. |
| |
|
| |
By: |
|
| |
Name: |
Jeffrey Tirman |
| |
Title: |
Chief Executive Officer |
| |
|
| |
|
|
| |
Name: |
|
[Signature Page to
Management Earnout Agreement]
Exhibit A
Management Members
[Signature Page to
Management Earnout Agreement]
Exhibit C
FORM OF
SPONSOR EARNOUT AGREEMENT
This
Sponsor Earnout Agreement (this “Agreement”), dated as of [●], 2022, is entered into by and between Abri
Ventures I, LLC, a Delaware limited liability company (the “Sponsor”), and Abri SPAC I, Inc., a Delaware corporation
(“Parent”). The Sponsor and Parent are sometimes referred to herein each as a “Party”
and together the “Parties”.
Recitals
WHEREAS,
Parent, Abri Merger Sub, Inc., a Delaware corporation (“Merger Sub”), DLQ, Inc., a Nevada corporation (the “Company”),
and Logiq, Inc., a Delaware corporation (the “DLQ Parent”), have entered into a Merger Agreement (the “Merger
Agreement”; capitalized terms used but not defined herein shall have their respective meanings assigned to them in the Merger
Agreement), dated as of September 9, 2022, pursuant to which Merger Sub will merge with and into the Company (the “Merger”)
and the Company will be the surviving company and a wholly-owned subsidiary of Parent; and
WHEREAS,
as a condition and an inducement to Parent and the Company entering into the Merger Agreement, the Sponsor and Parent have agreed that
1,000,000 shares of Parent Common Stock (collectively, the “Sponsor Earnout Shares”) will be issued to the Sponsor
free and clear of all Liens other than applicable federal and state securities restrictions.
NOW,
THEREFORE, in consideration of the premises, representations, warranties and the mutual covenants contained in this Agreement, and for
other good and valuable consideration, the receipt, sufficiency and adequacy of which are hereby acknowledged, the Parties agree as follows:
Agreement
1. Definitions. For
purposes hereof, the following terms when used in this Agreement shall have the respective meanings set forth below:
“Earnout
Period” means the First Earnout Period, the Second Earnout Period and the Third Earnout Period, as applicable.
“First
Earnout Period” means the period from and after the Closing until the first anniversary of the Closing Date.
“First
Milestone Event” means the occurrence of the following event: the closing share price of the shares of Parent Common Stock over
any twenty (20) consecutive Trading Days during the First Earnout Period is greater than or equal to $16.50 per share (subject to any
adjustment pursuant to Section 3(c)).
“Milestone
Event” means any of the First Milestone Event, Second Milestone Event and Third Milestone Event.
“Second
Earnout Period” means the period from and after the Closing until the second anniversary of the Closing Date.
“Second
Milestone Event” means the occurrence of the following event: the closing share price of the shares of Parent Common Stock over
any twenty (20) consecutive Trading Days during the Second Earnout Period is greater than or equal to $23.00 per share (subject to any
adjustment pursuant to Section 3(c)).
“Third
Earnout Period” means the period from and after the Closing until the third anniversary of the Closing Date.
“Third
Milestone Event” means the occurrence of the following event: the closing share price of the shares of Parent Common Stock over
any twenty (20) consecutive Trading Days during the Third Earnout Period is greater than or equal to $30.00 per share (subject to any
adjustment pursuant to Section 3(c)).
2. Issuance
and Release of the Sponsor Earnout Shares.
(a) The
Parties acknowledge and agree that the Sponsor Earnout Shares shall be: issued by Parent to the Sponsor, as additional consideration for
the Merger, free and clear of all Liens other than applicable federal and state securities restrictions:
(i) 250,000
Sponsor Earnout Shares shall be earned upon satisfaction of the First Milestone Event;
(ii) 350,000
Sponsor Earnout Shares shall be earned upon satisfaction of the Second Milestone Event; and
(iii) 400,000
Sponsor Earnout Shares shall be earned upon satisfaction of the Third Milestone Event.
Any Sponsor Earnout Shares
that are not earned on or before the expiration of the applicable Earnout Period shall be forfeited and cancelled.
(b) For
the avoidance of doubt: (i) more than one of the Milestone Events described in Sections 2(a) may occur at the same time
if occurring during the portion of the Earnout Period starting from and after the Closing Date and ending on the second anniversary of
the Closing Date; (ii) only the Milestone Events described in Sections 2(a)(ii) and (iii) may occur during the portion
of the Earnout Period starting from and after the first anniversary of the Closing Date and ending on the second anniversary of the Closing
Date; and (iii) only the Milestone Event described in Section 2(a)(iii) may occur during the portion of the Earnout Period
starting from and after the second anniversary of the Closing Date and ending on the third anniversary of the Closing Date.
3. Covenants
of Parent.
(a) Promptly
after each Milestone Event has occurred (but in any event within ten (10) Business Days after the occurrence of the applicable Milestone
Event), Parent shall take all actions required to be taken by Parent to issue the applicable Sponsor Earnout Shares to the Sponsor.
(b) Parent
shall take such actions as are reasonably requested by the Sponsor to evidence the issuances pursuant to Section 2(a), including
through the provision of an updated stock ledger showing such issuances (as certified by an officer of Parent responsible for maintaining
such ledger or the applicable registrar or transfer agent of Parent).
(c) In
the event Parent shall at any time during the Earnout Period pay any dividend on Parent Common Stock by the issuance of additional shares
of Parent Common Stock, or effect a subdivision or combination or consolidation of the outstanding Parent Common Stock (by reclassification
or otherwise) into a greater or lesser number of shares of Parent Common Stock, then in each such case, (i) the number of Sponsor Earnout
Shares shall be adjusted by multiplying such amount by a fraction, the numerator of which is the number of shares of Parent Common Stock
(including any other shares so reclassified as Parent Common Stock) outstanding immediately after such event and the denominator of which
is the number of shares of Parent Common Stock that were outstanding immediately prior to such event, and (ii) the dollar values set forth
in Sections 2(a) and Sections 4(a)-(c) shall be appropriately adjusted to provide to the Sponsor the same economic effect
as contemplated by this Agreement prior to such event.
(d) During
the Earnout Period, Parent shall take all reasonable efforts for Parent to remain listed as a public company on, and for the Parent Common
Stock to be tradable over, Nasdaq; provided, however, that the foregoing shall not limit Parent from consummating a Change in Control
or entering into a Contract that contemplates a Change in Control. Upon the consummation of any Change in Control during the Earnout Period,
other than as set forth in Section 4, Parent shall have no further obligations pursuant to this Section 3(d).
(e) Except
with respect to any amounts treated as imputed interest under Section 483 of the Code, any issuance of shares of Sponsor Earnout Shares
pursuant to this Agreement shall be treated as an adjustment to the merger consideration by the Parties for Tax purposes, unless otherwise
required by a change in applicable Tax Law. Any Earnout Share that is issued pursuant to this Agreement shall be treated as eligible for
non-recognition treatment under Section 354 of the Code (and shall not be treated as “other property” within the meaning of
Section 356 of the Code).
4.
Change in Control. If, at any time after the Closing and prior to or on the third (3rd) anniversary of the Closing
Date, there occurs any transaction resulting in a Change in Control, and the per share valuation of Parent Common Stock in such Change
in Control transaction prior to giving effect to the provisions of this Section 4 is: (a) greater than or equal to $16.50, then,
immediately prior to the consummation of such Change in Control, the Milestone Event set forth in Section 2(a)(i) shall
be deemed to have occurred if such Milestone Event shall not have previously occurred; (ii) greater than or equal to $23.00, then, immediately
prior to the consummation of such Change in Control, the Milestone Event set forth in Section 2(a)(ii) shall be deemed
to have occurred if such Milestone Event shall not have previously occurred; and (iii) greater than or equal to $30.00 then, immediately
prior to the consummation of such Change in Control, the Milestone Event set forth in Section 2(a)(iii) shall be deemed
to have occurred if such Milestone Event shall not have previously occurred (it being understood that such Change in Control may result
in the occurrence of more than one of the events as provided in clauses (i), (ii) and (iii)); provided, however, that, in each case of
clauses (i), (ii) and (iii), the applicable Sponsor Earnout Shares shall be released to the Sponsor as of immediately prior to the Change
in Control, and the Sponsor shall be eligible to participate in such Change in Control transaction with respect to such Sponsor Earnout
Shares.
5. Representations
and Warranties of the Sponsor. The Sponsor represents and warrants to Parent as follows:
(a) Organization
and Power. The Sponsor is duly organized, validly existing, and in good standing under the laws of the jurisdiction of its formation
and has all requisite power and authority to carry on its business as presently conducted and as proposed to be conducted.
(b) Authorization.
The Sponsor has full power and authority to enter into this Agreement. This Agreement, when executed and delivered by the Sponsor, shall
constitute the valid and legally binding obligation of the Sponsor, enforceable in accordance with its terms, except: (i) as limited
by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance and any other laws of general application affecting
enforcement of creditors’ rights generally; or (ii) as limited by laws relating to the availability of specific performance, injunctive
relief or other equitable remedies.
(c) Governmental
Consents and Filings. No consent, approval, order or authorization of, or registration, qualification, designation, declaration or
filing with, any federal, state or local governmental authority is required on the part of the Sponsor in connection with the consummation
of the transactions contemplated by this Agreement.
(d) Compliance
with Other Instruments. The execution, delivery and performance by the Sponsor of this Agreement and the consummation by the Sponsor
of the transactions contemplated by this Agreement will not result in any violation or default: (i) of any provisions of its organizational
documents, if applicable; (ii) of any instrument, judgment, order, writ or decree to which it is a party or by which it is bound; (iii)
under any note, indenture or mortgage to which it is a party or by which it is bound; (iv) under any lease, agreement, contract or purchase
order to which it is a party or by which it is bound; or (v) of any provision of any federal or state statute, rule or regulation applicable
to the Sponsor, in each case (other than clause (i)), which would have a material adverse effect on the Sponsor or its ability to consummate
the transactions contemplated by this Agreement.
6. Representations
and Warranties of Parent. Parent represents and warrants to the Sponsor as follows:
(a) Organization
and Corporate Power. Parent is duly organized, validly existing, and in good standing under the laws of the jurisdiction of its formation
and has all requisite power and authority to carry on its business as presently conducted and as proposed to be conducted.
(b) Authorization.
Parent has full power and authority to enter into this Agreement. This Agreement, when executed and delivered by Parent, shall constitute
the valid and legally binding obligation of Parent, enforceable against Parent in accordance with its terms except: (i) as limited by
applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, or other laws of general application relating to
or affecting the enforcement of creditors’ rights generally; or (ii) as limited by laws relating to the availability of specific
performance, injunctive relief, or other equitable remedies.
(c) Governmental
Consents and Filings. Assuming the accuracy of the representations and warranties made by the Sponsor in this Agreement, no consent,
approval, order or authorization of, or registration, qualification, designation, declaration or filing with, any federal, state or local
governmental authority is required on the part of Parent in connection with the consummation of the transactions contemplated by this
Agreement.
(d) Compliance
with Other Instruments. The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated
by this Agreement will not result in any violation or default: (i) of any provisions of its certificate of incorporation or other governing
documents; (ii) of any instrument, judgment, order, writ or decree to which it is a party or by which it is bound; (iii) under any note,
indenture or mortgage to which it is a party or by which it is bound; (iv) under any lease, agreement, contract or purchase order to which
it is a party or by which it is bound; or (v) of any provision of any federal or state statute, rule or regulation applicable to Parent,
in each case (other than clause (i)) which would have a material adverse effect on Parent or its ability to consummate the transactions
contemplated by this Agreement.
7. General
Provisions.
(a) Notices.
Any notice hereunder shall be sent in writing, addressed as specified below, and shall be deemed given: (i) if by hand or nationally recognized
overnight courier service, by 5:00 PM Eastern Time on a Business Day, addressee’s day and time, on the date of delivery, and if
delivered after 5:00 PM Eastern Time, on the first Business Day after such delivery; (ii) if by electronic mail or facsimile, on the date
of transmission with affirmative confirmation of receipt; or (iii) three (3) Business Days after mailing by prepaid certified or registered
mail, return receipt requested. Notices shall be addressed to the respective Parties as follows, or to such other address as a Party shall
specify to the others in accordance with these notice provisions:
if to Parent, to:
Abri SPAC I, Inc.
9663 Santa Monica Blvd., No. 1091
Beverly Hills, CA 90210
Attn: Jeffrey Tirman, Chief Executive Officer
E-mail: jtirman@abriadv.com
with a copy (which shall
not constitute notice) to:
Loeb & Loeb LLP
345 Park Ave
New York, NY 10154
Attention: Mitchell S. Nussbaum
Fax: 212.504.3013
E-mail: mnussbaum@loeb.com
if to the Sponsor, to:
Abri Ventures I, LLC.
9663 Santa Monica Blvd., No. 1091
Beverly Hills, CA 90210
Attn: Jeffrey Tirman, Chief Executive Officer
E-mail: jtirman@abriadv.com with a
copy (which shall not constitute notice) to:
Loeb & Loeb LLP
345 Park Ave
New York, NY 10154
Attention: Mitchell S. Nussbaum
Fax: 212.504.3013
E-mail: mnussbaum@loeb.com
(b) Survival
of Representations and Warranties. All of the representations and warranties contained herein shall survive the Closing.
(c) Entire
Agreement. This Agreement, together with any documents, instruments and writings that are delivered pursuant hereto or referenced
herein, constitutes the entire agreement and understanding of the Parties in respect of its subject matter and supersedes all prior understandings,
agreements, or representations by or among the Parties, written or oral, to the extent they relate in any way to the subject matter hereof
or the transactions contemplated hereby.
(d) Successors.
All of the terms, agreements, covenants, representations, warranties, and conditions of this Agreement are binding upon, and inure to
the benefit of and are enforceable by, the Parties and their respective successors. Nothing in this Agreement, express or implied, is
intended to confer upon any Party other than the Parties or their respective successors and assigns any rights, remedies, obligations
or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement.
(e) Assignments.
Except as otherwise specifically provided herein, no Party may assign either this Agreement or any of its rights, interests, or obligations
hereunder without the prior written approval of the other Party.
(f) Counterparts.
This Agreement may be executed, by manual or electronic signature, in two or more counterparts, each of which will be deemed an original
but all of which together will constitute one and the same instrument.
(g) Headings.
The section headings contained in this Agreement are inserted for convenience only and will not affect in any way the meaning or interpretation
of this Agreement.
(h) Governing
Law. This Agreement, the entire relationship of the Parties, and any litigation between the Parties (whether grounded in contract,
tort, statute, law or equity) shall be governed by, construed in accordance with, and interpreted pursuant to the laws of the State of
Delaware, without giving effect to its choice of laws principles.
(i) Jurisdiction.
The Parties (i) hereby irrevocably and unconditionally submit to the jurisdiction of the federal and state courts of New York (or any
appellate courts thereof) for the purpose of any suit, action or other proceeding arising out of or based upon this Agreement, (b) agree
not to commence any suit, action or other proceeding arising out of or based upon this Agreement except in the federal and state courts
of New York, and (c) hereby waive, and agree not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or
proceeding, any claim that it is not subject personally to the jurisdiction of the above-named courts, that its property is exempt or
immune from attachment or execution, that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit,
action or proceeding is improper or that this Agreement or the subject matter hereof may not be enforced in or by such court.
(j) Waiver
of Jury Trial. The Parties hereby waive any right to a jury trial in connection with any litigation pursuant to this Agreement and
the transactions contemplated hereby.
(k) Amendments.
This Agreement may not be amended, modified or waived as to any particular provision, except with the written consent of Parent and the
Sponsor.
(l) Severability.
The provisions of this Agreement will be deemed severable and the invalidity or unenforceability of any provision will not affect the
validity or enforceability of the other provisions hereof; provided that if any provision of this Agreement, as applied to any Party or
to any circumstance, is adjudged by a governmental authority, arbitrator, or mediator not to be enforceable in accordance with its terms,
the Parties agree that the governmental authority, arbitrator, or mediator making such determination will have the power to modify the
provision in a manner consistent with its objectives such that it is enforceable, and/or to delete specific words or phrases, and in its
reduced form, such provision will then be enforceable and will be enforced.
(m) Expenses.
Parent will bear all of the costs and expenses incurred in connection with the preparation, execution and performance of this Agreement
and the consummation of the transactions contemplated hereby, including all fees and expenses of agents (including transfer agents), representatives,
financial advisors, legal counsel and accountants.
(n) Construction.
The Parties have participated jointly in the negotiation and drafting of this Agreement. If an ambiguity or question of intent or interpretation
arises, this Agreement will be construed as if drafted jointly by the Parties and no presumption or burden of proof will arise favoring
or disfavoring any Party because of the authorship of any provision of this Agreement. Any reference to any federal, state, local, or
foreign law will be deemed also to refer to such law as amended and all rules and regulations promulgated thereunder, unless the context
requires otherwise. The words “include,” “includes,” and “including” will be
deemed to be followed by “without limitation.” Pronouns in masculine, feminine, and neuter genders will be construed
to include any other gender, and words in the singular form will be construed to include the plural and vice versa, unless the context
otherwise requires. The words “this Agreement,” “herein,” “hereof,” “hereby,”
“hereunder,” and words of similar import refer to this Agreement as a whole and not to any particular subdivision
unless expressly so limited. The Parties intend that each representation, warranty, and covenant contained herein will have independent
significance. If any Party has breached any representation, warranty, or covenant contained herein in any respect, the fact that there
exists another representation, warranty or covenant relating to the same subject matter (regardless of the relative levels of specificity)
which such Party has not breached will not detract from or mitigate the fact that such Party is in breach of the first representation,
warranty, or covenant.
(o) Waiver.
No waiver by any Party of any default, misrepresentation, or breach of warranty or covenant hereunder, whether intentional or not, may
be deemed to extend to any prior or subsequent default, misrepresentation, or breach of warranty or covenant hereunder or affect in any
way any rights arising because of any prior or subsequent occurrence.
(p) Confidentiality.
Except as may be required by law, regulation or applicable stock exchange listing requirements, unless and until the transactions contemplated
hereby and the terms hereof are publicly announced or otherwise publicly disclosed by Parent, the Parties shall keep confidential and
shall not publicly disclose the existence or terms of this Agreement.
[Signature page follows]
IN
WITNESS WHEREOF, the undersigned have executed this Agreement to be effective as of the date first set forth above.
| |
ABRI SPAC I, INC. |
| |
|
| |
By: |
|
| |
Name: |
Jeffrey Tirman |
| |
Title: |
Chief Executive Officer |
| |
ABRI VENTURES I, LLC |
| |
|
| |
By: |
|
| |
Name: |
Jeffrey Tirman |
| |
Title: |
Chief Executive Officer |
[Signature Page to
Sponsor Earnout Agreement]
Exhibit D
ABRI SPAC I, INC.
9663 Santa Monica Blvd., No. 1091
Los Angeles, CA 90210
[●], 2022
Abri Ventures I, LLC
9663 Santa Monica Blvd., No. 1091
Los Angeles, CA 90210
DLQ, Inc.
85 Broad Street, Suite 16-079
New York, NY 10004
Ladies and Gentlemen:
Reference is made to
that certain Merger Agreement dated September 9, 2022 (the “Merger Agreement”) among DLQ, Inc. (“DLQ”),
Logiq, Inc. (“DLQ Parent”), Abri SPAC I, Inc. (“Parent”), and Abri Merger Sub, Inc. (“Abri
Sub”) pursuant to which, Abri Sub will merge with and into DLQ, after which DLQ will be the surviving company and a wholly-owned
subsidiary of Parent (the “Merger”) and Parent shall change its name to “DataLogiq, Inc.”.
Pursuant to (a) a prospectus
dated August 9, 2021 (the “Prospectus”) with respect to an initial public offering of Parent’s securities,
Parent issued (i) 5,750,000 warrants (the “Public Warrants”) and (ii) an option for the holder of such option
to purchase, among other securities, up to 345,000 warrants (the “Option Warrants”); and (b) a concurrent private
placement conducted pursuant to a Private Units Purchase Agreement dated August 9, 2021, between Parent and Abri Ventures I, LLC (the
“Sponsor”), Parent issued 294,598 warrants (the “Private Warrants” and together with
the Public Warrants and the Option Warrants, the “Warrants”). Subject to certain restrictions as more fully
described in the Prospectus, each Warrant entitles the holder to purchase one share of Parent common stock, par value $0.0001 per share
(the “Common Stock”) at a price of $11.50 per share (the “Warrant Exercise Price”).
In connection with the
Merger, Parent, the Sponsor, DLQ Parent, and DLQ agree and covenant that Parent will split the proceeds of the Warrant Exercise Price
received at any time by Parent resulting solely from the cash exercise of any Warrant as follows:
A. 20%
of the gross proceeds of the Warrant Exercise Price received in cash by Parent shall be delivered to the Sponsor in cash or immediately
available funds not later than three business (3) days following Parent’s receipt of the cash exercise price of any Warrant;
B. Parent
shall keep 80% of the Warrant Exercise Price received in cash by Parent.
Parent, the Sponsor,
DLQ Parent, and DLQ acknowledge that they have had an opportunity to consult with independent legal counsel regarding the legal effect
of this letter agreement and transactions contemplated herein and each of them enters into this letter agreement freely and voluntarily.
This letter agreement
shall be governed by and construed in accordance with the laws of the State of New York, without regard to its choice-of-law provisions.
This letter agreement may be amended or terminated or any provision hereby waived only in writing. This letter agreement may be executed
in counterparts, each of which shall constitute an original, but all of which shall constitute one agreement.
By signing below, each
of Parent, the Sponsor, DLQ Parent, and DLQ agrees to the transactions contemplated herein.
Very truly yours,
Jeffrey Tirman, CEO
Abri SPAC I, Inc.
| |
Agreed and Acknowledged: |
| |
|
| |
DLQ, INC. |
| |
|
| |
By: |
|
| |
Name: |
Brent Suen |
| |
Title: |
Chief Executive Officer |
| |
LOGIQ, INC. |
| |
|
| |
By: |
|
| |
Name: |
Brent Suen |
| |
Title: |
Chief Executive Officer |
| |
Abri Ventures I, LLC |
| |
|
| |
By: |
|
| |
Name: |
Jeffrey Tirman |
| |
Title: |
Authorized Person |
Exhibit E
FORM OF
LOCK-UP AGREEMENT
THIS
LOCK-UP AGREEMENT (this “Agreement”) is dated as of [●], 2022 by and between the undersigned stockholder
(the “Holder”) and Abri SPAC I, Inc., a Delaware corporation (the “Parent”).
A.
Parent, Abri Merger Sub Inc., a Delaware corporation and wholly-owned subsidiary of the Parent, DLQ, Inc., a Nevada corporation (the “Company”)
and Logiq, Inc., a Delaware corporation and the parent of the Company (“DLQ Parent”) entered into a Merger Agreement
dated as of September 9, 2022 (the “Merger Agreement”). Capitalized terms used, but not otherwise defined herein,
shall have the meanings ascribed to such terms in the Merger Agreement.
B.
Pursuant to the Merger Agreement, Parent will become the 100% stockholder of the Company.
C.
The Holder is either (i) the record and/or beneficial owner of certain shares of Company Common Stock, which will be exchanged for shares
of Parent Common Stock pursuant to the Merger Agreement or (ii) a member of management of DLQ Parent that receives Dividend Shares of
Parent Common Stock as provided in the Merger Agreement.
D.
As a condition of, and as a material inducement for the Parent and the Company to enter into and consummate the transactions contemplated
by the Merger Agreement, the Holder has agreed to execute and deliver this Agreement, which shall be effective as of the Closing Date
of the Merger.
NOW,
THEREFORE, for and in consideration of the mutual covenants and agreements set forth herein, and other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, the parties, intending to be legally bound, agree as follows:
AGREEMENT
1. Lock-up.
(a)
Subject to Section 1(b) below, during the Lock-up Period, the Holder agrees that it, he or she will not offer, sell, contract to sell,
pledge or otherwise dispose of, directly or indirectly, any of the Lock-up Shares (as defined below), enter into a transaction that would
have the same effect, or enter into any swap, hedge or other arrangement that transfers, in whole or in part, any of the economic consequences
of ownership of the Lock-up Shares or otherwise, publicly disclose the intention to make any offer, sale, pledge or disposition, or to
enter into any transaction, swap, hedge or other arrangement, or engage in any Short Sales (as defined below) with respect to the Lock-up
Shares.
(b)
In furtherance of the foregoing, during the Lock-up Period, the Parent will (i) place a stop order on all the Lock-up Shares, including
those which may be covered by a registration statement, and (ii) notify the Parent’s transfer agent in writing of the stop order
and the restrictions on the Lock-up Shares under this Agreement and direct the Parent’s transfer agent not to process any attempts
by the Holder to resell or transfer any Lock-up Shares, except in compliance with this Agreement.
(c)
For purposes hereof, “Short Sales” include, without limitation, all “short sales” as defined in
Rule 200 of Regulation SHO under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and all
types of direct and indirect stock pledges, forward sale contracts, options, puts, calls, swaps and similar arrangements (including on
a total return basis), and sales and other transactions through non-U.S. broker dealers or foreign regulated brokers.
(d)
The term “Lock-up Period” means the date that is eleven (11) months after the Closing Date (as defined in the
Merger Agreement).
2. Beneficial Ownership. The
Holder hereby represents and warrants that it does not beneficially own, directly or through its nominees (as determined in accordance
with Section 13(d) of the Exchange Act, and the rules and regulations promulgated thereunder), any shares of Parent Common Stock, or
any economic interest in or derivative of such shares, other than those shares of Parent Common Stock issued pursuant to the Merger Agreement.
For purposes of this Agreement, the Merger Consideration Shares (other than the Dividend Shares being distributed by DLQ Parent to it
stockholders concurrent with the Closing) beneficially owned by the Holder, together with any other shares of Parent Common Stock, and
including any securities convertible into, or exchangeable for, or representing the rights to receive Parent Common Stock, if any, acquired
during the Lock-up Period are collectively referred to as the “Lock-up Shares,” provided, however,
that such Lock-up Shares shall not include shares of Parent Common Stock acquired by such Holder in open market transactions during the
Lock-up Period. For the avoidance of doubt, notwithstanding anything contained in this paragraph, the parties have agreed that the Dividend
Shares distributed to members of management are Lock-up Shares.
Notwithstanding
the foregoing, and subject to the conditions below, the undersigned may transfer Lock-up Shares in connection with (a) transfers or distributions
to the Holder’s direct or indirect affiliates (within the meaning of Rule 405 under the Securities Act of 1933, as amended (the
“Securities Act”)) or to the estates of any of the foregoing; (b) any transfers exempt from registration under
the Securities Act; (c) transfers 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 for estate planning purposes; (d) by virtue of the laws of descent
and distribution upon death of the Holder; (e) pursuant to a qualified domestic relations order; (f) transfers to the Parent’s officers,
directors or their affiliates; (g) transfers pursuant to a bona fide third-party tender offer, merger, stock sale, recapitalization, consolidation
or other transaction involving a change of control of Parent; provided, however, that in the event that such tender
offer, merger, recapitalization, consolidation or other such transaction is not completed, the Lock-up Shares subject to this Agreement
shall remain subject to this Agreement; (h) the establishment of a trading plan pursuant to Rule 10b5-1 promulgated under the Exchange
Act; provided, however, that such plan does not provide for the transfer of Lock-up Shares during the Lock-up
Period; (i) transfers to satisfy tax withholding obligations in connection with the exercise of options to purchase shares of Parent Common
Stock or the vesting of stock-based awards or shares of Parent Common Stock issued pursuant to that certain Management Earnout Agreement;
and (j) transfers in payment on a “net exercise” or “cashless” basis of the exercise or purchase price with respect
to the exercise of options to purchase shares of Parent Common Stock; provided, however, that, in the case of
any transfer pursuant to the foregoing (a) through (f) clauses, it shall be a condition to any such transfer that (i) the transferee/donee
agrees in writing (a copy of which shall be provided by the Holder to the parties hereto and to Continental Stock and Transfer Company),
to be bound by the terms of this Agreement (including, without limitation, the restrictions set forth in the preceding sentence) to the
same extent as if the transferee/donee were a party hereto; and (ii) each party (donor, donee, transferor or transferee) shall not be
required by law (including without limitation the disclosure requirements of the Securities Act and the Exchange Act) to make, and shall
agree to not voluntarily make, any filing or public announcement of the transfer or disposition prior to the expiration of the Lock-up
Period. The Holder hereby covenants to Parent that the Holder will give notice to Parent of any transfer of Lock-up Shares pursuant to
this Section 2 of the Agreement, with such notice given in accordance with Section 5 of this Agreement.
3. Representations
and Warranties. Each of the parties hereto, by their respective execution and delivery of this Agreement, hereby represents and
warrants to the other that (a) such party has the full right, capacity and authority to enter into, deliver and perform its respective
obligations under this Agreement, (b) this Agreement has been duly executed and delivered by such party and is a binding and enforceable
obligation of such party and, enforceable against such party in accordance with the terms of this Agreement, and (c) the execution, delivery
and performance of such party’s obligations under this Agreement will not conflict with or breach the terms of any other agreement,
contract, commitment or understanding to which such party is a party or to which the assets or securities of such party are bound. The
Holder has independently evaluated the merits of his/her/its decision to enter into and deliver this Agreement, and such Holder confirms
that he/she/it has not relied on the advice of Company, Company’s legal counsel, or any other person.
4. No
Additional Fees/Payment. Other than the consideration specifically referenced herein, the parties hereto agree that no fee, payment
or additional consideration in any form has been or will be paid to the Holder in connection with this Agreement.
5. Notices. Any
notices required or permitted to be sent hereunder shall be sent in writing, addressed as specified below, and shall be deemed given:
(a) if by hand or recognized courier service, by 4:00PM on a Business Day, addressee’s day and time, on the date of delivery, and
otherwise on the first Business Day after such delivery; (b) if by email, on the date that transmission is confirmed electronically,
if by 4:00PM on a Business Day, addressee’s day and time, and otherwise on the first Business Day after the date of such confirmation;
or (c) five days after mailing by certified or registered mail, return receipt requested. Notices shall be addressed to the respective
parties as follows (excluding telephone numbers, which are for convenience only), or to such other address as a party shall specify to
the others in accordance with these notice provisions:
(a) If to Company, to:
[ ]
with a copy (which shall
not constitute notice) to:
[ ]
if to Parent or Merger
Sub (prior to the Closing):
Abri SPAC I, Inc.
9663 Santa Monica Blvd., No. 1091
Beverly Hills, CA 90210
Attn: Jeffrey Tirman, Chief Executive Officer
E-mail: jtirman@abriadv.com
with a copy (which shall
not constitute notice) to:
Loeb & Loeb LLP
345 Park Ave
New York, NY 10154
Attention: Mitchell S. Nussbaum
Fax: 212.504.3013
E-mail: mnussbaum@loeb.com
(b) If to the Holder, to
the address set forth on the Holder’s signature page hereto, with a copy, which shall not constitute notice, to:
Abri Ventures I, LLC.
9663 Santa Monica Blvd., No. 1091
Beverly Hills, CA 90210
Attn: Jeffrey Tirman, Chief Executive Officer
E-mail: jtirman@abriadv.com
or to such other address(es)
as any party may have furnished to the others in writing in accordance herewith.
6. Enumeration
and Headings. The enumeration and headings contained in this Agreement are for convenience of reference only and shall not control
or affect the meaning or construction of any of the provisions of this Agreement.
7. Counterparts. This
Agreement may be executed in facsimile and in any number of counterparts, each of which when so executed and delivered shall be deemed
an original, but all of which shall together constitute one and the same agreement. This Agreement shall become effective upon delivery
to each party of an executed counterpart or the earlier delivery to each party of original, photocopied or electronically transmitted
signature pages that together (but need not individually) bear the signatures of all other parties.
8. Successors
and Assigns. This Agreement and the terms, covenants, provisions and conditions hereof shall be binding upon, and shall inure
to the benefit of, the respective heirs, successors and assigns of the parties hereto. The Holder hereby acknowledges and agrees that
this Agreement is entered into for the benefit of and is enforceable by Company and its successors and assigns.
9. Severability. If
any provision of this Agreement is held to be invalid or unenforceable for any reason, such provision will be conformed to prevailing
law rather than voided, if possible, in order to achieve the intent of the parties and, in any event, the remaining provisions of this
Agreement shall remain in full force and effect and shall be binding upon the parties hereto.
10. Amendment. This
Agreement may be amended or modified by written agreement executed by each of the parties hereto.
11. Further
Assurances. Each party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute
and deliver all such other agreements, certificates, instruments and documents, as any other party may reasonably request in order to
carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.
12. No
Strict Construction. The language used in this Agreement will be deemed to be the language chosen by the parties to express their
mutual intent, and no rules of strict construction will be applied against any party.
13. Dispute
Resolution. Section 12.15 (Waiver of Jury Trial) and 12.16 (Submission to Jurisdiction) of the Merger Agreement is incorporated
by reference herein to apply with full force to any disputes arising under this Agreement.
14. Governing
Law. Section 12.7 (Governing Law) of the Merger Agreement is incorporated by reference herein to apply with full force to any
disputes arising under this Agreement.
15. Controlling
Agreement. To the extent the terms of this Agreement (as amended, supplemented, restated or otherwise modified from time to time)
directly conflicts with any provision in the Merger Agreement, the terms of this Agreement shall control.
[Signature Page Follows]
IN
WITNESS WHEREOF, the parties hereto have caused this Lock-up Agreement to be duly executed by their respective authorized signatories
as of the date first indicated above.
| |
ABRI SPAC I., INC. |
| |
|
| |
By: |
|
| |
Name: |
Jeffrey Tirman |
| |
Title: |
Chief Executive Officer |
Exhibit F
FORM OF
AMENDED AND RESTATED
REGISTRATION RIGHTS AGREEMENT
THIS
AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of the [●] day
of ______, 2022, is made and entered into by and among Abri SPAC I, Inc., a Delaware corporation (the “Company”),
the undersigned party listed under Investor on the signature page hereto (the “Investor”) and Chardan Capital
Markets, LLC, as the underwriter (the “Underwriter”) in connection with this Agreement.
WHEREAS,
reference is made to that certain Registration Rights Agreement, dated August 9, 2021, by and among the Company, the Investor and Chardan
Capital Markets, LLC as representative of the underwriter in connection with the IPO (as defined below) of the securities of the Company
(the “Original Registration Rights Agreement”), pursuant to which the Company granted the Investor and the Underwriter
certain registration rights with respect to certain securities of the Company, as set forth therein;
WHEREAS,
pursuant to Section 6.7 of the Original Registration Rights Agreement, the provisions, covenants and conditions set forth therein may
be amended or modified upon the written consent of the Company and the holders of at least a majority-in-interest of the “Registrable
Securities” (as defined in the Original Registration Rights Agreement);
WHEREAS,
the Company, Abri Merger Sub, Inc., a Delaware corporation (“Merger Sub”), DLQ, Inc. (“DLQ”),
and Logiq, Inc. the parent of DLQ have entered into that certain Merger Agreement (as may be amended from time to time, the “Merger
Agreement”), dated as of September 9, 2022, pursuant to which, on the Effective Date (as defined below), the Company, Merger
Sub and DLQ effected a merger of Merger Sub with and into DLQ (the “DLQ Merger”), upon which (a) Merger Sub
ceased to exist, (b) DLQ became a wholly owned subsidiary of the Company and (c) the outstanding shares of DLQ Common Stock converted
into the right to receive such number of shares of Common Stock (as defined below) as more fully described in the Merger Agreement. Capitalized
terms used, but not otherwise defined herein, shall have the meanings ascribed to such terms in the Merger Agreement.
WHEREAS,
the Investor, the Company and the Underwriter desire to amend and restate the Original Registration Rights Agreement in its entirety and
enter into this Agreement in connection with the closing of the transactions contemplated by the Merger Agreement and to amend and restate
the Original Registration Rights Agreement to provide the Investor, the Underwriter and holders of the Earnout Shares (as defined below),
with certain rights relating to the registration of certain securities of the Company, as set forth herein;
NOW,
THEREFORE, in consideration of the mutual covenants and agreements set forth herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
1. DEFINITIONS.
The following capitalized terms used herein have the following meanings:
“Agreement”
means this Agreement, as amended, restated, supplemented, or otherwise modified from time to time.
“Business
Day” means a day other than Saturday, Sunday or other day on which commercial banks in New York, New York are authorized
or required by law to close.
“Commission”
means the Securities and Exchange Commission, or any other federal agency then administering the Securities Act or the Exchange Act.
“Common
Stock” means the common stock, par value $0.0001 per share, of the Company.
“Company”
is defined in the preamble to this Agreement.
“Demand
Registration” is defined in Section 2.1.1.
“Demanding
Holder” is defined in Section 2.1.1.
“DLQ”
is defined in the preamble to this Agreement.
“DLQ
Merger” is defined in the preamble to this Agreement.
“Earnout
Shares” means (i) up to 1,000,000 shares of Common Stock to be issued to Investor in connection with the Earnout Agreement,
dated [ ], 2022, by and between the Company and the Investor and (ii) (i) up to 2,000,000 shares of Common Stock to be issued to certain
members of management of DLQ in connection with the Earnout Agreement, dated [ ], 2022, by and between the Company and certain members
of management (the “Management Earnout Shares”).
“Effective
Date” means the closing date of the DLQ Merger.
“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission promulgated
thereunder, all as the same shall be in effect at the time.
“Form
S-3” is defined in Section 2.3.
“Indemnified
Party” is defined in Section 4.3.
“Indemnifying
Party” is defined in Section 4.3.
“Initial
Shares” means the 1,433,480 shares of Common Stock issued to the Investor prior to the consummation of the Company’s
IPO.
“Investor”
is defined in the preamble to this Agreement.
“Investor
Indemnified Party” is defined in Section 4.1.
“IPO”
means the initial public offering of Company’s securities pursuant to a prospectus dated August 9, 2021.
“Maximum
Number of Shares” is defined in Section 2.1.4.
“Merger
Agreement” is defined in the preamble to this Agreement.
“Merger
Sub” is defined in the preamble to this Agreement.
“Notices”
is defined in Section 6.3.
“Original
Registration Rights Agreement” is defined in the preamble to this Agreement.
“Person”
means a company, corporation, association, partnership, limited liability company, organization, joint venture, trust or other legal entity,
an individual, a government or political subdivision thereof or a governmental agency.
“Piggy-Back
Registration” is defined in Section 2.2.1.
“Private
Units” means the 294,598 Units the Investor privately purchased simultaneously with the consummation of the Company’s
IPO.
“Pro
Rata” is defined in Section 2.1.4.
“Register,”
“Registered” and “Registration” mean a registration effected by preparing and filing
a registration statement or similar document in compliance with the requirements of the Securities Act, and the applicable rules and regulations
promulgated thereunder, and such registration statement becoming effective.
“Registrable
Securities” means (i) the Initial Shares, (ii) the Private Units (and underlying shares of Common Stock, including the
shares of Common Stock issued or issuable upon the exercise of any Warrants), (iii) the Earnout Shares, if any, (iv) the Units included
in the Unit Purchase Option (and underlying shares of Common Stock, including the shares of Common Stock issued or issuable upon the
exercise of any Warrants), if any, and (v) any securities issuable upon conversion of loans from Investor to the Company, if any (the
“Loan Securities”). Registrable Securities include any warrants, shares of capital stock or other securities
of the Company issued as a dividend or other distribution with respect to or in exchange for or in replacement of such (i) Initial Shares,
(ii) Private Units (and underlying shares of Common Stock including the shares of Common Stock issued or issuable upon the exercise of
any Warrants), (iii)) Earnout Shares, (iv) Units included in the Unit Purchase Option, (and underlying shares of Common Stock, including
the shares of Common Stock issued or issuable upon the exercise of any Warrants), and (v) Loan Securities. As to any particular Registrable
Securities, such securities shall cease to be Registrable Securities when: (a) a Registration Statement with respect to the sale of such
securities shall have become effective under the Securities Act and such securities shall have been sold, transferred, disposed of or
exchanged in accordance with such Registration Statement; (b) such securities shall have been otherwise transferred, new certificates
for them not bearing a legend restricting further transfer shall have been delivered by the Company and subsequent public distribution
of them shall not require registration under the Securities Act; (c) such securities shall have ceased to be outstanding, or (d) the
Registrable Securities are freely saleable under Rule 144 without volume limitations.
“Registration
Statement” means a registration statement filed by the Company with the Commission in compliance with the Securities Act
and the rules and regulations promulgated thereunder for a public offering and sale of equity securities, or securities or other obligations
exercisable or exchangeable for, or convertible into, equity securities (other than a registration statement on Form S-4 or Form S-8,
or their successors, or any registration statement covering only securities proposed to be issued in exchange for securities or assets
of another entity).
“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations of the Commission promulgated thereunder,
all as the same shall be in effect at the time.
“Underwriter”
means, solely for the purposes of this Agreement, Chardan Capital Markets, LLC as a securities dealer who purchases any Registrable Securities
as principal in an Underwritten Offering and not as part of such dealer’s market-making activities.
“Underwritten
Offering” means a Registration in which securities of the Company are sold to the Underwriter in a firm commitment underwriting
for distribution to the public.
“Unit
or Units” means the units of the Company, each Unit comprised of one share of Common Stock and one redeemable Warrant to
acquire one share of Common Stock at a price of $11.50 per share.
“Unit
Purchase Option” means the Underwriter’s option to purchase up to 300,000 Units at $11.50 per Unit.
“Warrant(s)”
means the warrants of the Company exercisable to acquire one share of Common Stock at a price of $11.50 per share.
2. REGISTRATION
RIGHTS.
2.1.
Demand Registration.
2.1.1. Demand
Registration Rights. At any time and from time to time on or after the Effective Date, the holders of (y) a majority-in-interest of
the Registrable Securities (excluding the Management Earnout Shares), on the one hand, or (z) a majority-in-interest of the Management
Earnout Shares held by Company affiliates, on the other hand, as the case may be, and/or their respective transferees, may make a written
demand, on no more than two occasions in any twelve month period, for registration under the Securities Act on Form S-1 (except if the
Company is then eligible to register the Registrable Securities on Form S-3, then such registration shall be on Form S-3) of all or part
of their Registrable Securities, as the case may be (a “Demand Registration”). Any demand for a Demand Registration
shall specify the number of shares of Registrable Securities proposed to be sold and the intended method(s) of distribution thereof. The
Company will notify all holders of Registrable Securities of the demand, within five (5) days after the receipt by the Company of such
Demand Registration, and each holder of Registrable Securities who wishes to include all or a portion of such holder’s Registrable
Securities in the Demand Registration (each such holder including shares of Registrable Securities in such registration, a “Demanding
Holder”) shall so notify the Company within fifteen (15) days after the receipt by the holder of the notice from the Company.
Upon any such request, the Demanding Holders shall be entitled to have their Registrable Securities included in the Demand Registration,
subject to Section 2.1.4 and the provisos set forth in Section 3.1.1. Upon receipt of a Demand Registration (a) the Company agrees to
file a Registration Statement with the Commission with respect to such Demand Registration not later than thirty (30) days after the receipt
by the Company of such Demand Registration (the “Filing Deadline”) or (b) if a Registration Statement with respect
to the Registrable Securities has been previously declared effective, the Company shall use its commercially
reasonable efforts to keep such Registration Statement continuously effective under the Securities Act until such time as there are no
Registrable Securities outstanding. The Company agrees to pay the Investor a cash penalty of $25,000 per day (x) for each day beyond the
Filing Deadline for which it has failed to file such Registration Statement with the Commission or (y) if a Registration Statement with
respect to the Registrable Securities has previously been declared effective, for each day that such Registration Statement is not continuously
effective under the Securities Act, until such time as there are no Registrable Securities outstanding. The Company shall not be obligated
to effect more than an aggregate of two (2) Demand Registrations per calendar year under this Section 2.1.1 in respect of all Registrable
Securities. Notwithstanding the foregoing, the Underwriter and its related persons may not have more than one Demand Registration at the
Company’s expense.
2.1.2. Effective
Registration. A registration will not count as a Demand Registration until (A) the Registration Statement filed with the Commission
with respect to such Demand Registration has been declared effective by the Commission and the Company has complied with all of its obligations
under this Agreement with respect thereto, and (B) the Registration Statement has remained effective continuously until the earlier of
(x) one (1) year after being declared effective, or (y) the date on which all of the Registrable Securities requested by the Demanding
Holders to be registered in such Registration Statement have been sold; provided, however, that if, after such
Registration Statement has been declared effective, the offering of Registrable Securities pursuant to a Demand Registration is interfered
with by any stop order or injunction of the Commission or any other governmental agency or court, the Registration Statement with respect
to such Demand Registration will be deemed not to have been declared effective, unless and until, (i) such stop order or injunction is
removed, rescinded or otherwise terminated, and (ii) a majority-in-interest of the Demanding Holders thereafter elect to continue the
offering; provided, further, that the Company shall not be obligated to file a second Registration Statement until a Registration Statement
that has been filed is counted as a Demand Registration or is terminated.
2.1.3. Underwritten
Offering pursuant to Demand Registration. If a majority-in-interest of the Demanding Holders so elect and such holders so advise the
Company as part of their written demand for a Demand Registration, the offering of such Registrable Securities pursuant to such Demand
Registration shall be in the form of an Underwritten Offering. In such event, the right of any holder to include its Registrable Securities
in such registration shall be conditioned upon such holder’s participation in such underwriting and the inclusion of such holder’s
Registrable Securities in the underwriting to the extent provided herein. All Demanding Holders proposing to distribute their Registrable
Securities through such underwriting shall enter into an underwriting agreement in customary form with the Underwriter or underwriters
selected for such Underwritten Offering by a majority-in-interest of the holders initiating the Demand Registration.
2.1.4. Reduction
of Underwritten Offering in Connection with Demand Registration. If the Underwriter or the managing underwriters in an Underwritten
Offering effected pursuant to a Demand Registration in good faith advises the Company and the Demanding Holders in writing that the dollar
amount or number of shares of Registrable Securities which the Demanding Holders desire to sell, taken together with all other shares
of Common Stock or other securities which the Company desires to sell and the shares of Common Stock, if any, as to which a registration
has been requested pursuant to separate written contractual piggy-back registration rights held by other stockholders of the Company who
desire to sell, exceeds the maximum dollar amount or maximum number of shares that can be sold in such Underwritten Offering without adversely
affecting the proposed offering price, the timing, the distribution method or the probability of success of such offering (such maximum
dollar amount or maximum number of shares, as applicable, the “Maximum Number of Shares”), then the Company
shall include in such registration: (i) first, the Registrable Securities as to which Demand Registration has been requested by the Demanding
Holders (pro rata in accordance with the number of shares that each such Demanding Holder has requested be included in such registration,
regardless of the number of shares held by each such Demanding Holder (such proportion is referred to herein as “Pro Rata”))
that can be sold without exceeding the Maximum Number of Shares; (ii) second, to the extent that the Maximum Number of Shares has not
been reached under the foregoing clause (i), the shares of Common Stock or other securities that the Company desires to sell that can
be sold without exceeding the Maximum Number of Shares; and (iii) third, to the extent that the Maximum Number of Shares has not been
reached under the foregoing clauses (i) and (ii), the shares of
Common Stock or other securities for the account of other persons that the Company is obligated to register pursuant to other written
contractual arrangements with such persons and that can be sold without exceeding the Maximum Number of Shares.
2.1.5. Demand
Registration Withdrawal. If a majority-in-interest of the Demanding Holders disapprove of the terms of any Underwritten Offering or
are not entitled to include all of their Registrable Securities in any Underwritten Offering, such majority-in-interest of the Demanding
Holders may elect to withdraw from such offering by giving written notice to the Company and the Underwriter or underwriters of their
request to withdraw prior to the effectiveness of the Registration Statement filed with the Commission with respect to such Demand Registration.
If the majority-in-interest of the Demanding Holders withdraws from a proposed Underwritten Offering relating to a Demand Registration,
then such registration shall not count as a Demand Registration provided for in this Section 2.1.
2.2. Piggy-Back
Registration.
2.2.1. Piggy-Back
Registration Rights. If at any time on or after the Effective Date, the Company proposes to file a Registration Statement under the
Securities Act with respect to an offering of equity securities, or securities or other obligations exercisable or exchangeable for, or
convertible into, equity securities, by the Company for its own account or for stockholders of the Company for their account (or by the
Company and by stockholders of the Company including, without limitation, pursuant to Section 2.1), other than a Registration Statement
(i) filed in connection with any employee stock option or other benefit plan, or (ii) for a stock dividend or dividend reinvestment plan,
then the Company shall (x) give written notice of such proposed filing to the holders of Registrable Securities as soon as practicable
but in no event less than ten (10) days before the anticipated filing date of such Registration Statement, which notice shall describe
the amount and type of securities to be included in such offering, the intended method(s) of distribution, and the name of the proposed
managing underwriter or underwriters, if any, of the offering, and (y) offer to the holders of Registrable Securities in such notice the
opportunity to register the sale of such number of shares of Registrable Securities as such holders may request in writing within five
(5) days following receipt of such notice (a “Piggy-Back Registration”). The Company shall cause such Registrable
Securities to be included in such registration and shall use its best efforts to cause the managing underwriter or underwriters of a proposed
Underwritten Offering to permit the Registrable Securities requested to be included in a Piggy-Back Registration on the same terms and
conditions as any similar securities of the Company and to permit the sale or other disposition of such Registrable Securities in accordance
with the intended method(s) of distribution thereof. All holders of Registrable Securities proposing to distribute their Registrable Securities
through a Piggy-Back Registration that involves an Underwriter or Underwriters shall enter into an underwriting agreement in customary
form with the Underwriter or Underwriters selected for such Piggy-Back Registration. Notwithstanding the provisions set forth in the immediately
preceding sentences, the right to a Piggy-Back Registration set forth under this Section 2.2.1 with respect to the Registrable Securities
shall terminate on the seventh anniversary of the Effective Date.
2.2.2. Reduction
of Underwritten Offering in Connection with Piggy-Back Registration. If the managing Underwriter or Underwriters for a Piggy-Back
Registration that is to be an Underwritten Offering advises the Company and the holders of Registrable Securities participating in the
Underwritten Offering in writing that the dollar amount or number of shares of Common Stock which the Company desires to sell in such
Underwritten Offering, taken together with the shares of Common Stock, if any, as to which inclusion in such Underwritten Offering has
been demanded pursuant to separate written contractual arrangements with persons other than the holders of Registrable Securities hereunder,
the Registrable Securities as to which inclusion in such Underwritten Offering has been requested under this Section 2.2.1 above, and
the shares of Common Stock, if any, as to which inclusion in such Underwritten Offering has been requested pursuant to the written contractual
piggy-back registration rights of other stockholders of the Company, exceeds the Maximum Number of Shares, then the Company shall include
in any such registration:
a) If
the Underwritten Offering is undertaken for the Company’s account: (A) first, the shares of Common Stock or other equity securities
that the Company desires to sell in such Underwritten Offering that can be sold without exceeding the Maximum Number of Shares; (B) second,
to the extent that the Maximum Number of Shares has not been reached under the foregoing clause (A), the shares of Common Stock or other
securities, if any, comprised of Registrable Securities, as to which registration has been requested pursuant to the applicable written
contractual piggy-back registration rights of such security holders, Pro Rata, that can be sold without exceeding the Maximum Number
of Shares; and (C) third, to the extent that the Maximum Number of Shares has not been reached under the foregoing clauses (A) and (B),
the shares of Common Stock or other securities for the account of other persons that the Company is obligated to register pursuant to
written contractual piggy-back registration rights with such persons and that can be sold without exceeding the Maximum Number of Shares;
b) If
the registration is a “demand” registration undertaken at the demand of persons other than either the holders of Registrable
Securities, (A) first, the shares of Common Stock or other securities for the account of the demanding persons that can be sold without
exceeding the Maximum Number of Shares; (B) second, to the extent that the Maximum Number of Shares has not been reached under the foregoing
clause (A), the shares of Common Stock or other securities that the Company desires to sell that can be sold without exceeding the Maximum
Number of Shares; (C) third, to the extent that the Maximum Number of Shares has not been reached under the foregoing clauses (A) and
(B), collectively the shares of Common Stock or other securities comprised of Registrable Securities, Pro Rata, as to which registration
has been requested pursuant to the terms hereof, that can be sold without exceeding the Maximum Number of Shares; and (D) fourth, to the
extent that the Maximum Number of Shares has not been reached under the foregoing clauses (A), (B) and (C), the shares of Common Stock
or other securities for the account of other persons that the Company is obligated to register pursuant to written contractual arrangements
with such persons, that can be sold without exceeding the Maximum Number of Shares.
2.2.3. Piggy-Back
Registration Withdrawal. Any holder of Registrable Securities may elect to withdraw such holder’s request for inclusion of Registrable
Securities in any Piggy-Back Registration by giving written notice to the Company of such request to withdraw prior to the effectiveness
of the Registration Statement. The Company (whether on its own determination or as the result of a withdrawal by persons making a demand
pursuant to written contractual obligations) may withdraw a Registration Statement at any time prior to the effectiveness of such Registration
Statement. Notwithstanding any such withdrawal, the Company shall pay all expenses incurred by the holders of Registrable Securities in
connection with such Piggy-Back Registration as provided in Section 3.3.
2.2.4. Unlimited
Piggy-back Registration Rights. For purposes of clarity, any Registration or Underwritten Offering effected pursuant to Section 2.2.
hereof shall not be counted as a Demand Registration effected pursuant to Section 2.1 hereof.
2.3. Registrations
on Form S-3.
The
holders of Registrable Securities may at any time and from time to time, request in writing that the Company, pursuant to Rule 415 under
the Securities Act (or any successor rule promulgated thereafter by the Commission), register the resale of any or all of such Registrable
Securities on Form S-3 or any similar short-form registration which may be available at such time (“Form S-3”);
provided, however, that (i) the Company shall not be obligated to effect such request through an Underwritten Offering and (ii) the Company
shall not be obligated to effect more than two such requests. Upon receipt of such written request, the Company will promptly give written
notice of the proposed registration to all other holders of Registrable Securities, and, as soon as practicable thereafter, effect the
registration of all or such portion of such holder’s or holders’ Registrable Securities as are specified in such request,
together with all or such portion of the Registrable Securities or other securities of the Company, if any, of any other holder or holders
joining in such request as are specified in a written request given within fifteen (15) days after receipt of such written notice from
the Company; provided, however, that the Company shall not be obligated to effect any such registration pursuant
to this Section 2.3: (i) if Form S-3 is not available for such offering; or (ii) if the holders of the Registrable Securities, together
with the holders of any other securities of the Company entitled to inclusion in such registration, propose to sell Registrable Securities
and such other securities (if any) at any aggregate price to the public of less than $10,000,000. Registrations effected pursuant to this
Section 2.3 shall not be counted as Demand Registrations effected pursuant to Section 2.1.
3. REGISTRATION
PROCEDURES.
3.1. Filings;
Information.
Whenever
the Company is required to effect the registration of any Registrable Securities pursuant to Section 2, the Company shall use its best
efforts to effect the registration and sale of such Registrable Securities in accordance with the intended method(s) of distribution thereof
as expeditiously as practicable, and in connection with any such request:
3.1.1. Filing
Registration Statement; Restriction on Registration Rights. The Company shall use its best efforts to, as expeditiously as possible
after receipt of a request for a Demand Registration pursuant to Section 2.1, prepare and file with the Commission a Registration Statement
on any form for which the Company then qualifies or which counsel for the Company shall deem appropriate and which form shall be available
for the sale of all Registrable Securities to be registered thereunder in accordance with the intended method(s) of distribution thereof,
and shall use its best efforts to cause such Registration Statement to become effective and use its best efforts to keep it effective
for the period required by Section 3.1.3; provided, however, that the Company shall have the right to defer any
Demand Registration for up to ninety (90) days, and any Piggy-Back Registration for such period as may be applicable to deferment of any
demand registration to which such Piggy-Back Registration relates, in each case if the Company shall furnish to the holders a certificate
signed by Chief Executive Officer or Chairman of the Company stating that, in the good faith judgment of the Board of Directors of the
Company, it would be materially detrimental to the Company and its stockholders for such Registration Statement to be effected at such
time; provided further, that the Company shall not have the right to exercise the right set forth in this provision more than
once in any 365-day period in respect of a Demand Registration hereunder.
3.1.2. Copies.
The Company shall, prior to filing a Registration Statement or prospectus, or any amendment or supplement thereto, furnish without charge
to the holders of Registrable Securities included in such registration, and such holders’ legal counsel, copies of such Registration
Statement as proposed to be filed, each amendment and supplement to such Registration Statement (in each case including all exhibits thereto
and documents incorporated by reference therein except for such exhibits and documents available on the Commission’s Electronic
Data Gathering, Analysis and Retrieval System), the prospectus included in such Registration Statement (including each preliminary prospectus),
and such other documents as the holders of Registrable Securities included in such registration or legal counsel for any such holders
may request in order to facilitate the disposition of the Registrable Securities owned by such holders.
3.1.3. Amendments
and Supplements. The Company shall prepare and file with the Commission such amendments, including post-effective amendments, and supplements
to such Registration Statement and the prospectus used in connection therewith as may be necessary to keep such Registration Statement
effective and in compliance with the provisions of the Securities Act until all Registrable Securities and other securities covered by
such Registration Statement have been disposed of in accordance with the intended method(s) of distribution set forth in such Registration
Statement or such securities have been withdrawn.
3.1.4. Notification.
After the filing of a Registration Statement, the Company shall promptly, and in no event more than two (2) Business Days after such
filing, notify the holders of Registrable Securities included in such Registration Statement of such filing, and shall further notify
such holders promptly and confirm such advice in writing in all events within two (2) Business Days of the occurrence of any of the following:
(i) when such Registration Statement becomes effective; (ii) when any post-effective amendment to such Registration Statement becomes
effective; (iii) the issuance or threatened issuance by the Commission of any stop order (and the Company shall take all actions required
to prevent the entry of such stop order or to remove it if entered); and (iv) any request by the Commission for any amendment or supplement
to such Registration Statement or any prospectus relating thereto or for additional information or of the occurrence of an event requiring
the preparation of a supplement or amendment to such prospectus so that, as thereafter delivered to the purchasers of the securities
covered by such Registration Statement, such prospectus will not contain an untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements therein not misleading, and promptly make available to
the holders of Registrable Securities included in such Registration Statement any such supplement or amendment; except that before filing
with the Commission a Registration Statement or prospectus or any amendment or supplement thereto, including documents incorporated by
reference, the Company shall furnish to the holders of Registrable Securities included in such Registration Statement and to the legal
counsel for any such holders, copies of all such documents proposed to be filed sufficiently in advance of filing to provide such holders
and legal counsel with a reasonable opportunity to review such documents and comment thereon, and the Company shall not file any Registration
Statement or prospectus or amendment or supplement thereto, including documents incorporated by reference, to which such holders or their
legal counsel shall object.
3.1.5. State
Securities Laws Compliance. The Company shall use its best efforts to (i) register or qualify the Registrable Securities covered by the
Registration Statement under such securities or “blue sky” laws of such jurisdictions in the United States as the holders
of Registrable Securities included in such Registration Statement (in light of their intended plan of distribution) may request and (ii)
take such action necessary to cause such Registrable Securities covered by the Registration Statement to be registered with or approved
by such other governmental authorities as may be necessary by virtue of the business and operations of the Company and do any and all
other acts and things that may be necessary or advisable to enable the holders of Registrable Securities included in such Registration
Statement to consummate the disposition of such Registrable Securities in such jurisdictions; provided, however, that the Company shall
not be required to qualify generally to do business in any jurisdiction where it would not otherwise be required to qualify but for this
paragraph or subject itself to taxation in any such jurisdiction.
3.1.6. Agreements
for Disposition. The Company shall enter into customary agreements (including, if applicable, an underwriting agreement in customary
form) and take such other actions as are reasonably required in order to expedite or facilitate the disposition of such Registrable Securities.
The representations, warranties and covenants of the Company in any underwriting agreement which are made to or for the benefit of any
Underwriters, to the extent applicable, shall also be made to and for the benefit of the holders of Registrable Securities included in
such registration statement. No holder of Registrable Securities included in such registration statement shall be required to make any
representations or warranties in the underwriting agreement except, if applicable, with respect to such holder’s organization,
good standing, authority, title to Registrable Securities, lack of conflict of such sale with such holder’s material agreements
and organizational documents, and with respect to written information relating to such holder that such holder has furnished in writing
expressly for inclusion in such Registration Statement.
3.1.7. Cooperation.
The principal executive officer of the Company, the principal financial officer of the Company, the principal accounting officer of the
Company and all other officers and members of the management of the Company shall cooperate in all reasonable respects in any offering
of Registrable Securities hereunder, which cooperation shall include, without limitation, the preparation of the Registration Statement
with respect to such offering and all other offering materials and related documents, and participation in meetings with Underwriters,
attorneys, accountants and potential investors.
3.1.8. Records.
The Company shall make available for inspection by the holders of Registrable Securities included in such Registration Statement, any
Underwriter participating in any disposition pursuant to such registration statement and any attorney, accountant or other professional
retained by any holder of Registrable Securities included in such Registration Statement or any Underwriter, all financial and other
records, pertinent corporate documents and properties of the Company, as shall be necessary to enable them to exercise their due diligence
responsibility, and cause the Company’s officers, directors and employees to supply all information reasonably requested by any
of them in connection with such Registration Statement.
3.1.9. Opinions
and Comfort Letters. Upon request, the Company shall furnish to each holder of Registrable Securities included in any Registration Statement
a signed counterpart, addressed to such holder, of (i) any opinion of counsel to the Company delivered to any Underwriter and (ii)
any comfort letter from the Company’s independent public accountants delivered to any Underwriter. In the event no legal opinion
is delivered to any Underwriter, the Company shall furnish to each holder of Registrable Securities included in such Registration Statement,
at any time that such holder elects to use a prospectus, an opinion of counsel to the Company to the effect that the Registration Statement
containing such prospectus has been declared effective and that no stop order is in effect.
3.1.10. Earnings
Statement. The Company shall comply with all applicable rules and regulations of the Commission and the Securities Act, and make
available to its stockholders, as soon as practicable, an earnings statement covering a period of twelve (12) months, which earnings
statement shall satisfy the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder.
3.1.11. Listing.
The Company shall use its best efforts to cause all Registrable Securities included in any registration to be listed on such exchanges
or otherwise designated for trading in the same manner as similar securities issued by the Company are then listed or designated or, if
no such similar securities are then listed or designated, in a manner satisfactory to the holders of a majority of the Registrable Securities
included in such registration.
3.1.12. Road
Show. If the registration involves the registration of Registrable Securities involving gross proceeds in excess of $25,000,000, the
Company shall use its reasonable efforts to make available senior executives of the Company to participate in customary “road show”
presentations that may be reasonably requested by the Underwriter in any Underwritten Offering.
3.1.13. Regulation
M. The Company shall take no direct or indirect action prohibited by Regulation M under the Exchange Act; provided, that, to the extent
that any prohibition is applicable to the Company, the Company will take all reasonable action to make any such prohibition inapplicable.
3.2. Obligation
to Suspend Distribution.
Upon
receipt of any notice from the Company of the happening of any event of the kind described in Section 3.1.4(iv), or, in the case
of a resale registration, on Form S-1 or other applicable form pursuant to Section 2.1 hereof, or Form S-3 pursuant to Section 2.3 hereof,
upon any suspension by the Company, pursuant to a written insider trading compliance program adopted by the Company’s Board of Directors,
of the ability of all “insiders” covered by such program to transact in the Company’s securities because of the existence
of material non-public information, each holder of Registrable Securities included in any registration shall immediately discontinue disposition
of such Registrable Securities pursuant to the Registration Statement covering such Registrable Securities until such holder receives
the supplemented or amended prospectus contemplated by Section 3.1.4(iv) or the restriction on the ability of “insiders” to
transact in the Company’s securities is removed, as applicable, and, if so directed by the Company, each such holder will deliver
to the Company all copies, other than permanent file copies then in such holder’s possession, of the most recent prospectus covering
such Registrable Securities at the time of receipt of such notice.
3.3. Registration
Expenses.
The
Company shall bear all costs and expenses incurred in connection with any Demand Registration pursuant to Section 2.1 (as limited by Section
2.1.1), any Piggy-Back Registration pursuant to Section 2.2, and any registration on Form S-3 effected pursuant to Section 2.3, and all
expenses incurred in performing or complying with its other obligations under this Agreement, whether or not the Registration Statement
becomes effective, including, without limitation: (i) all registration and filing fees; (ii) fees and expenses of compliance with securities
or “blue sky” laws (including fees and disbursements of counsel in connection with blue sky qualifications of the Registrable
Securities); (iii) printing expenses; (iv) the Company’s internal expenses (including, without limitation, all salaries and expenses
of its officers and employees); (v) the fees and expenses incurred in connection with the listing of the Registrable Securities as required
by Section 3.1.11; (vi) Financial Industry Regulatory Authority fees; (vii) fees and disbursements of counsel for the Company and fees
and expenses for independent certified public accountants retained by the Company (including the expenses or costs associated with the
delivery of any opinions or comfort letters requested pursuant to Section 3.1.9); (viii) the reasonable fees and expenses of any special
experts retained by the Company in connection with such registration and (ix) the reasonable fees and expenses of one legal counsel selected
by the holders of a majority-in-interest of the Registrable Securities included in such registration. The Company shall have no obligation
to pay any underwriting discounts or selling commissions attributable to the Registrable Securities being sold by the holders
thereof, which underwriting discounts or selling commissions shall be borne by such holders. Additionally, in an Underwritten Offering,
all selling stockholders and the Company shall bear the expenses of the Underwriter pro rata in proportion to the respective amount of
shares each is selling in such offering.
3.4. Holder’s
Information
The
holders of Registrable Securities shall provide such information as may reasonably be requested by the Company, or the managing Underwriter,
if any, in connection with the preparation of any Registration Statement, including amendments and supplements thereto, in order to effect
the registration of any Registrable Securities under the Securities Act pursuant to Section 2 and in connection with the Company’s
obligation to comply with federal and applicable state securities laws.
The
Company’s obligations to include the Registrable Securities in any Registration Statement under this Agreement are contingent upon
each holder of Registrable Securities furnishing in writing to the Company such information regarding such holder, the securities of the
Company held by holder and the intended method of disposition of the Registrable Securities as shall be reasonably requested by the Company
to effect the registration of the Registrable Securities, and such holder shall execute such documents in connection with such registration
as the Company may reasonably request that are customary of a selling stockholder in similar situations.
4. INDEMNIFICATION
AND CONTRIBUTION.
4.1. Indemnification
by the Company.
The
Company agrees to indemnify and hold harmless each Investor and each other holder of Registrable Securities, and each of their respective
officers, employees, affiliates, directors, partners, members, attorneys and agents, and each person, if any, who controls an Investor
and each other holder of Registrable Securities (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange
Act) (each, an “Investor Indemnified Party”), from and against any expenses, losses, judgments, claims, damages
or liabilities, whether joint or several, arising out of or based upon any untrue statement (or allegedly untrue statement) of a material
fact contained in (or incorporated by reference in) any Registration Statement under which the sale of such Registrable Securities was
registered under the Securities Act, any preliminary prospectus, final prospectus or summary prospectus contained in the Registration
Statement, or free writing prospectus (as defined in Rule 405 under the Securities Act or any successor rule thereof), or any amendment
or supplement to such Registration Statement, or any filing under any state securities law required to be filed or furnished, or arising
out of or based upon any omission (or alleged omission) to state a material fact required to be stated therein or necessary to make the
statements therein not misleading, or any violation by the Company of the Securities Act or any rule or regulation promulgated thereunder
applicable to the Company and relating to action or inaction required of the Company in connection with any such registration; and the
Company shall promptly reimburse the Investor Indemnified Party for any legal and any other expenses reasonably incurred by such Investor
Indemnified Party in connection with investigating and defending any such expense, loss, judgment, claim, damage, liability or action; provided, however,
that the Company will not be liable in any such case to the extent that any such expense, loss, claim, damage or liability arises out
of or is based upon any untrue statement or allegedly untrue statement or omission or alleged omission made in such Registration Statement,
preliminary prospectus, final prospectus, or summary prospectus, or any such amendment or supplement, in reliance upon and in conformity
with information furnished to the Company, in writing, by such selling holder expressly for use therein. The Company also shall indemnify
any Underwriter of the Registrable Securities, their officers, affiliates, directors, partners, members and agents and each person who
controls such Underwriter on substantially the same basis as that of the indemnification provided above in this Section 4.1.
4.2. Indemnification
by Holders of Registrable Securities.
Each selling holder of
Registrable Securities will, in the event that any registration is being effected under the Securities Act pursuant to this Agreement
of any Registrable Securities held by such selling holder, indemnify and hold harmless the Company, each of its directors and officers
and each Underwriter (if any), and each other selling holder and each other person, if any, who controls another selling holder or such
Underwriter within the meaning of the Securities Act, against any losses, claims, judgments, damages or liabilities, whether joint or
several, insofar as such losses, claims, judgments, damages or liabilities (or actions in respect thereof) arise out of or are based
upon any untrue statement or allegedly untrue statement of a material fact contained in any Registration Statement under which the sale
of such Registrable Securities was registered under the Securities Act, any preliminary prospectus, final prospectus or summary prospectus
contained in the Registration Statement, or any amendment or supplement to the Registration Statement, or arise out of or are based upon
any omission or the alleged omission to state a material fact required to be stated therein or necessary to make the statement therein
not misleading, if the statement or omission was made in reliance upon and in conformity with information furnished in writing to the
Company by such selling holder expressly for use therein, and shall reimburse the Company, its directors and officers, each Underwriter
(if any) and each other selling holder or controlling Person for any legal or other expenses reasonably incurred by any of them in connection
with investigation or defending any such loss, claim, damage, liability or action. Each selling holder’s indemnification obligations
hereunder shall be several and not joint and shall be limited to the amount of any net proceeds (after payment of any underwriting fees,
discounts, commissions or taxes) actually received by such selling holder.
4.3. Conduct
of Indemnification Proceedings.
Promptly
after receipt by any person of any notice of any loss, claim, damage or liability or any action in respect of which indemnity may be sought
pursuant to Section 4.1 or 4.2, such person (the “Indemnified Party”) shall, if a claim in respect thereof is
to be made against any other person for indemnification hereunder, notify such other person (the “Indemnifying Party”)
in writing of the loss, claim, judgment, damage, liability or action; provided, however, that the failure by the Indemnified Party to
notify the Indemnifying Party shall not relieve the Indemnifying Party from any liability which the Indemnifying Party may have to such
Indemnified Party hereunder, except and solely to the extent the Indemnifying Party is actually prejudiced by such failure. If the Indemnified
Party is seeking indemnification with respect to any claim or action brought against the Indemnified Party, then the Indemnifying Party
shall be entitled to participate in such claim or action, and, to the extent that it wishes, jointly with all other Indemnifying Parties,
to assume control of the defense thereof with counsel satisfactory to the Indemnified Party. After notice from the Indemnifying Party
to the Indemnified Party of its election to assume control of the defense of such claim or action, the Indemnifying Party shall not be
liable to the Indemnified Party for any legal or other expenses subsequently incurred by the Indemnified Party in connection with the
defense thereof other than reasonable costs of investigation; provided, however, that in any action in which both the Indemnified Party
and the Indemnifying Party are named as defendants, the Indemnified Party shall have the right to employ separate counsel (but no more
than one such separate counsel) to represent the Indemnified Party and its controlling persons who may be subject to liability arising
out of any claim in respect of which indemnity may be sought by the Indemnified Party against the Indemnifying Party, with the fees and
expenses of such counsel to be paid by such Indemnifying Party if, based upon the written opinion of counsel of such Indemnified Party,
representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between them.
No Indemnifying Party shall, without the prior written consent of the Indemnified Party, consent to entry of judgment or effect any settlement
of any claim or pending or threatened proceeding in respect of which the Indemnified Party is or could have been a party and indemnity
could have been sought hereunder by such Indemnified Party, unless such judgment or settlement includes an unconditional release of such
Indemnified Party from all liability arising out of such claim or proceeding.
4.4. Contribution.
4.4.1. If
the indemnification provided for in the foregoing Sections 4.1, 4.2 and 4.3 is unavailable to any Indemnified Party in respect of any
loss, claim, damage, liability or action referred to herein, then each such Indemnifying Party, in lieu of indemnifying such Indemnified
Party, shall contribute to the amount paid or payable by such Indemnified Party as a result of such loss, claim, damage, liability or
action in such proportion as is appropriate to reflect the relative fault of the Indemnified Parties and the Indemnifying Parties in connection
with the actions or omissions which resulted in such loss, claim, damage, liability or action, as well as any other relevant equitable
considerations. The relative fault of any Indemnified Party and any Indemnifying Party shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by such Indemnified Party or such Indemnifying Party and the parties’ relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or omission.
4.4.2. The
parties hereto agree that it would not be just and equitable if contribution pursuant to this Section 4.4 were determined by pro
rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to in the immediately
preceding Section 4.4.1.
4.4.3. The
amount paid or payable by an Indemnified Party as a result of any loss, claim, damage, liability or action referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set forth above, any legal or other expenses incurred by such
Indemnified Party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section
4.4, no holder of Registrable Securities shall be required to contribute any amount in excess of the dollar amount of the net proceeds
(after payment of any underwriting fees, discounts, commissions or taxes) actually received by such selling holder from the sale of Registrable
Securities which gave rise to such contribution obligation. No person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.
5. RULE
144.
5.1. Rule
144. The Company covenants that it shall file any reports required to be filed by it under the Securities Act and the Exchange Act and
shall take such further action as the holders of Registrable Securities may reasonably request, all to the extent required from time to
time to enable such holders to sell Registrable Securities without registration under the Securities Act within the limitation of the
exemptions provided by Rule 144 under the Securities Act, as such Rules may be amended from time to time, or any similar rule or regulation
hereafter adopted by the Commission.
6. MISCELLANEOUS.
6.1. Other
Registration Rights.
The
Company represents and warrants that, except as disclosed in the Company’s registration statement on Form S-1 (File No. 333-257916)
no person, other than the holders of the Registrable Securities hereunder, has any right to require the Company to register any shares
of the Company’s capital stock for sale or to include the Company’s shares of capital stock in any registration filed by the
Company for the sale of shares of capital stock for its own account or for the account of any other person.
6.2. Assignment;
No
Third Party Beneficiaries. This Agreement and the rights, duties and obligations of the Company hereunder may not be assigned or delegated
by the Company in whole or in part without the consent of the holders of a majority of Registrable Securities. This Agreement and the
rights, duties and obligations of the holders of Registrable Securities hereunder may be freely assigned or delegated by such holder of
Registrable Securities in conjunction with and to the extent of any transfer of Registrable Securities by any such holder. This Agreement
and the provisions hereof shall be binding upon and shall inure to the benefit of each of the parties, to the permitted assigns of the
Investor or holder of Registrable Securities or of any assignee of the Investor or holder of Registrable Securities. This Agreement is
not intended to confer any rights or benefits on any persons that are not party hereto other than as expressly set forth in Article 4
and this Section 6.2.
6.3. Notices.
All notices, demands,
requests, consents, approvals or other communications (collectively, “Notices”) required or permitted to be
given hereunder or which are given with respect to this Agreement shall be in writing and shall be personally served, delivered by reputable
air courier service with charges prepaid, or transmitted by hand delivery, or electronic transmission addressed as set forth below, or
to such other address as such party shall have specified most recently by written notice. Notice shall be deemed given on the date of
service or transmission if personally served or transmitted electronically by email; provided, that if such service or transmission is
not on a Business Day or is after normal business hours, then such notice shall be deemed given on the next Business Day. Notice otherwise
sent as provided herein shall be deemed given on the next Business Day following timely delivery of such notice to a reputable air courier
service with an order for next-day delivery. The parties hereto consent to the delivery of notices or other communications by electronic
transmission at the e-mail address set forth below the respective party’s name in Section 6.3 hereto. To the extent that any notice
given by means of electronic transmission is returned or undeliverable for any reason, the foregoing consent shall be deemed to have been
revoked until a new or corrected e-mail address has been provided, and such attempted electronic notice shall be ineffective and deemed
to not have been given. Each party agrees to promptly notify the other parties of any change in its e-mail address, and that failure to
do so shall not affect the foregoing. The parties may change the persons and addresses to which the notices or other communications are
to be sent by giving written notice to any such change in the manner provided herein for giving notice.
To the Company:
Abri SPAC I, Inc.
9663 Santa Monica Blvd., No. 1091
Beverly Hills, CA 90210
Attn: Jeffrey Tirman, Chief Executive Officer
Email: [●]
with a copy to:
Loeb & Loeb LLP
345 Park Avenue
New York, NY 10154
Attn: Alex Weniger-Araujo, Esq.
Email: [●]
To the Investor: to the address
set forth below such Investor’s name on Exhibit A hereto.
To the Underwriter:
Chardan
Capital Markets, LLC
17 State Street, Suite 2100
New York, New York 10004
Attn: George Kaufman
Email: __________________
with copy to:
[ ]
Email: [ ]
6.4. 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 that is valid and enforceable.
6.5. Counterparts.
This
Agreement may be executed in multiple counterparts, each of which shall be deemed an original, and all of which taken together shall constitute
one and the same instrument. This Agreement shall be effective when it has been executed by parties. The words “execution,”
“signed,” “signature,” and words of like import in this Agreement or in any other certificate, agreement or document
related to this Agreement shall include images of manually executed signatures transmitted by facsimile or other electronic format (including
“pdf,” “tif” or “jpg”) and other electronic signatures (including DocuSign and AdobeSign). The use
of electronic signatures and electronic records (including any contract or other record created, generated, sent, communicated, received
or stored by electronic means) shall be of the same legal effect, validity and enforceability as a manually executed signature or use
of a paper-based record-keeping system to the fullest extent permitted by applicable law, including the Federal Electronic Signatures
in Global and National Commerce Act, the New York State Electronic Signatures and Records Act and any other applicable law, including
any state law based on the Uniform Electronic Transactions Act or the Uniform Commercial Code. This Agreement may be executed and delivered
by telecopier or other facsimile transmission all with the same force and effect as if the same was a fully executed and delivered original
manual counterpart. Delivery of an executed signature page of this Agreement by facsimile transmission, electronic mail or E-Fax, or otherwise
to or from an electronic system or other equivalent service shall be as effective as delivery of a manually executed counterpart hereof.
6.6. Entire
Agreement.
This
Agreement (including all agreements entered into pursuant hereto and all certificates and instruments delivered pursuant hereto and thereto)
constitute the entire agreement of the parties with respect to the subject matter hereof and supersede all prior and contemporaneous agreements,
representations, understandings, negotiations and discussions between the parties, whether oral or written.
6.7. Modifications
and Amendments.
No
amendment, modification or termination of this Agreement shall be binding upon the Company unless executed in writing by the Company.
No amendment, modification or termination of this Agreement shall be binding upon the holders of the Registrable Securities unless executed
in writing by the holders of the majority Registrable Securities.
6.8. Titles
and Headings.
Titles
and headings of sections of this Agreement are for convenience only and shall not affect the construction of any provision of this Agreement.
6.9. Waivers
and Extensions.
Any
party to this Agreement may waive any right, breach or default which such party has the right to waive, provided that such waiver will
not be effective against the waiving party unless it is in writing, is signed by such party, and specifically refers to this Agreement.
Waivers may be made in advance or after the right waived has arisen or the breach or default waived has occurred. Any waiver may be conditional.
No waiver of any breach of any agreement or provision herein contained shall be deemed a waiver of any preceding or succeeding breach
thereof nor of any other agreement or provision herein contained. No waiver or extension of time for performance of any obligations or
acts shall be deemed a waiver or extension of the time for performance of any other obligations or acts.
6.10. Remedies
Cumulative.
In
the event that the Company fails to observe or perform any covenant or agreement to be observed or performed under this Agreement, any
Investor or any other holder of Registrable Securities may proceed to protect and enforce its rights by suit in equity or action at law,
whether for specific performance of any term contained in this Agreement or for an injunction against the breach of any such term or in
aid of the exercise of any power granted in this Agreement or to enforce any other legal or equitable right, or to take any one or more
of such actions, without being required to post a bond. None of the rights, powers or remedies conferred under this Agreement shall be
mutually exclusive, and each such right, power or remedy shall be cumulative and in addition to any other right, power or remedy, whether
conferred by this Agreement or now or hereafter available at law, in equity, by statute or otherwise.
6.11. Governing
Law.
This
Agreement shall be governed by, interpreted under, and construed in accordance with the internal laws of the State of Delaware applicable
to agreements made and to be performed within the State of Delaware, without giving effect to any choice-of-law provisions thereof that
would compel the application of the substantive laws of any other jurisdiction.
6.12. Consent
to Jurisdiction.
The
parties hereto agree to submit any matter or dispute resulting from, or arising out of, the execution, performance, interpretation, breach
or termination of this Agreement to the non-exclusive jurisdiction of federal or state courts within the State of New York. Each of the
parties agrees that service of any process, summons, notice or document in the manner set forth in Section 6.3 hereof or in such other
manner as may be permitted by applicable law, shall be effective service of process for any proceeding in the State of New York with
respect to any matters to which it has submitted to jurisdiction in this Section 6.12. Each of the parties hereto irrevocably and unconditionally
agrees that it is subject to, and hereby submits to, the personal jurisdiction of the courts located in the State of New York for any
action, suit or proceeding arising out of this Agreement or the transactions contemplated hereunder and waives any objection to the laying
of venue in the United States District Court for the Southern District of New York, or the New York state courts if the federal jurisdictional
standards are not satisfied, and hereby further irrevocably and unconditionally waives and agrees not to plead or claim in any such court
that any such action, suit or proceeding brought in any such court has been brought in an inconvenient forum.
6.13. Waiver
of Trial by Jury.
Each
party hereby irrevocably and unconditionally waives the right to a trial by jury in any action, suit, counterclaim or other proceeding
(whether based on contract, tort or otherwise) arising out of, connected with or relating to this Agreement, the transactions contemplated
hereby, or the actions of the Investor in the negotiation, administration, performance or enforcement hereof.
[REMAINDER OF PAGE INTENTIONALLY
LEFT BLANK.]
IN
WITNESS WHEREOF, the parties have caused this Agreement to be executed and delivered by their duly authorized representatives as of the
date first written above.
| |
COMPANY: |
| |
|
| |
ABRI SPAC I, INC. |
| |
|
| |
By: |
|
|
| |
Name: |
|
Jeffrey Tirman |
| |
Title: |
|
Chief Executive Officer |
| |
INVESTOR: |
| |
|
| |
ABRI VENTURES I, LLC |
| |
|
| |
By: |
|
|
| |
Name: |
|
Jeffrey Tirman |
| |
Title: |
|
Authorized Member |
IN
WITNESS WHEREOF, the parties have caused this Agreement to be executed and delivered by their duly authorized representatives as of the
date first written above.
| |
UNDERWRITER: |
| |
|
| |
CHARDAN CAPITAL MARKETS, LLC |
| |
|
| |
By: |
|
|
| |
Name: |
|
George Kaufman |
| |
Title: |
|
Managing Partner |
Exhibit A
Name and Address of Investor
To the Investor:
· Abri
Ventures I, LLC
/o Abri SPAC I, Inc.
9663 Santa Monica Blvd., No. 1091
Beverly Hills, CA 90210
Attn: Jeffrey Tirman, Authorized Member
Email: jtirman@abriadv.com
Exhibit G
FORM OF
SECOND AMENDED AND
RESTATED
CERTIFICATE OF INCORPORATION
OF
ABRI SPAC I, INC.
[•]
Abri
SPAC I, Inc., a corporation organized and existing under the laws of the State of Delaware (the “Corporation”),
DOES HEREBY CERTIFY AS FOLLOWS:
1.
The name of the Corporation is “Abri SPAC I, Inc.” The original certificate of incorporation of the Corporation
was filed with the Secretary of State of the State of Delaware on March 18, 2021 (the “Original Certificate”).
2.
The Amended and Restated Certificate of Incorporation was filed with the Delaware Secretary of State on August 9, 2021 (the “First
A&R Certificate”).
3.
This Second Amended and Restated Certificate of Incorporation (this “Second Amended and Restated Certificate”),
which restates and amends the provisions of the First A&R Certificate, was duly adopted in accordance with Sections 242 and 245 of
the General Corporation Law of the State of Delaware, as amended from time to time (the “DGCL”).
4.
This Second Amended and Restated Certificate shall become effective on the date of filing with the Secretary of State of Delaware.
5.
The text of the First A&R Certificate is hereby restated and amended in its entirety to read as follows:
ARTICLE
I
NAME
The
name of the corporation is DataLogiq, Inc. (the “Corporation”).
ARTICLE
II
PURPOSE
The
purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the DGCL.
ARTICLE
III
REGISTERED AGENT
The
address of the Corporation’s registered office in the State of Delaware is 3411 Silverside Road, Tatnall Building #104, in the City
of Wilmington, County of New Castle, State of Delaware, 19810, and the name of the Corporation’s registered agent at such address
is Corporate Creations Network Inc.
ARTICLE
IV
CAPITALIZATION
Section
4.1 Authorized Capital Stock. The total number of shares of all classes of capital stock which the Corporation is authorized
to issue is 300,000,000 shares, consisting of (a) 200,000,000 shares of common stock, par value $0.0001 per share (the “Common
Stock”) and (b) 100,000,000 shares of preferred stock, par value $0.0001 per share (the “Preferred Stock”).
Section
4.2 Preferred Stock. Subject to Article IX of this Amended and Restated Certificate, the Board of Directors of the Corporation
(the “Board”) is hereby expressly authorized to provide out of the unissued shares of the Preferred Stock for
one or more series of Preferred Stock and to establish from time to time the number of shares to be included in each such series and to
fix the voting rights, if any, designations, powers, preferences and relative, participating, optional, special and other rights, if any,
of each such series and any qualifications, limitations and restrictions thereof, as shall be stated in the resolution or resolutions
adopted by the Board providing for the issuance of such series and included
in a certificate of designation (a “Preferred Stock Designation”) filed pursuant to the DGCL, and the Board is hereby expressly
vested with the authority to the full extent provided by law, now or hereafter, to adopt any such resolution or resolutions.
Section
4.3 Common Stock.
(a) Voting.
(i)
Except as otherwise required by law or this Second Amended and Restated Certificate, the holders of the shares of Common Stock shall exclusively
possess all voting power with respect to the Corporation.
(ii)
Except as otherwise required by law or this Second Amended and Restated Certificate, the holders of shares of Common Stock shall be entitled
to one vote for each such share on each matter properly submitted to the stockholders of the Corporation on which the holders of the shares
of Common Stock are entitled to vote.
(iii)
Except as otherwise required by law or this Second Amended and Restated Certificate (including any Preferred Stock Designation), at any
annual or special meeting of the stockholders of the Corporation, the holders of the shares of Common Stock and the holders of any outstanding
series of the Preferred Stock shall have the exclusive right to vote for the election of directors and on all other matters properly submitted
to a vote of the stockholders of the Corporation. Notwithstanding the foregoing, except as otherwise required by law or this Second Amended
and Restated Certificate, the holders of the shares of Common Stock shall not be entitled to vote on any amendment to this Second Amended
and Restated Certificate that relates solely to the terms of one or more outstanding series of Preferred Stock if the holders of such
affected series of Preferred Stock are entitled, either separately or together with the holders of one or more other such series, to vote
thereon pursuant to this Second Amended and Restated Certificate or the DGCL.
(b) Dividends.
Subject to applicable law and the rights, if any, of the holders of any outstanding series of the Preferred Stock, the holders of the
shares of Common Stock shall be entitled to receive such dividends and other distributions (payable in cash, property or capital stock
of the Corporation) when, as and if declared thereon by the Board from time to time out of any assets or funds of the Corporation legally
available therefor and shall share equally on a per share basis in such dividends and distributions.
(c) Liquidation,
Dissolution or Winding Up of the Corporation. Subject to applicable law, the rights, if any, of the holders of any outstanding
series of the Preferred Stock, in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Corporation,
after payment or provision for payment of the debts and other liabilities of the Corporation, the holders of the shares of Common Stock
shall be entitled to receive all the remaining assets of the Corporation available for distribution to its stockholders, ratably in proportion
to the number of shares of Common Stock held by them.
Section
4.4 Rights and Options. The Corporation has the authority to create and issue rights, warrants and options entitling
the holders thereof to acquire from the Corporation any shares of its capital stock of any class or classes, with such rights, warrants
and options to be evidenced by or in instrument(s) approved by the Board. The Board is empowered to set the exercise price, duration,
times for exercise and other terms and conditions of such rights, warrants or options; provided, however, that
the consideration to be received for any shares of capital stock issuable upon exercise thereof may not be less than the par value thereof.
ARTICLE
V
BOARD OF DIRECTORS
Section
5.1 Board Powers. The business and affairs of the Corporation shall be managed by, or under the direction of, the Board.
In addition to the powers and authority expressly conferred upon the Board by statute, this Second Amended and Restated Certificate or
the Bylaws of the Corporation (“Bylaws”), the Board is hereby empowered to exercise all such powers and do all
such acts and things as may be exercised or done by the Corporation, subject, nevertheless, to the provisions of the DGCL, this Second
Amended and Restated Certificate, and any Bylaws adopted by the stockholders of the Corporation; provided, however,
that no Bylaws hereafter adopted by the stockholders of the Corporation shall invalidate any prior act of the Board that would have been
valid if such Bylaws had not been adopted.
Section
5.2 Number, Election and Term.
(a)
The number of directors of the Corporation, other than those who may be elected by the holders of one or more series of the Preferred
Stock voting separately by class or series, shall be fixed from time to time exclusively by the Board pursuant to a resolution adopted
by the Board.
(b)
Each director of the Corporation shall serve for a term expiring at the next annual meeting of stockholders following such director’s
appointment or election and until such director’s successor is duly elected and qualified, or until such director’s earlier
death, resignation, disqualification or removal. Subject to the rights of the holders of one or more series of Preferred Stock, voting
separately by class or series, to elect directors pursuant to the terms of one or more series of Preferred Stock, the election of directors
shall be determined by a plurality of the votes cast by the stockholders present in person or represented by proxy at the meeting and
entitled to vote thereon.
(c)
No decrease in the number of directors constituting the Board of Directors shall shorten the term of any incumbent director.
(d)
Unless and except to the extent that the Bylaws shall so require, the election of directors need not be by written ballot. The holders
of shares of Common Stock shall not have cumulative voting rights with respect to any election of directors.
Section
5.3 Newly Created Directorships and Vacancies. Subject to Section 5.5 hereof, newly created directorships
resulting from an increase in the number of directors and any vacancies on the Board resulting from death, resignation, retirement, disqualification,
removal or other cause may be filled solely and exclusively by a majority vote of the remaining directors then in office, even if less
than a quorum, or by a sole remaining director (and not by stockholders), and any director so chosen shall hold office for the remainder
of the full term in which the vacancy occurred and until his or her successor has been elected and qualified, subject, however, to such
director’s earlier death, resignation, retirement, disqualification or removal.
Section
5.4 Removal. Subject to Section 5.5 hereof, any director may be removed from office without cause
but only by the affirmative vote of the holders of not less than a majority of the outstanding stock of the Corporation entitled to vote
generally in the election of directors, voting together as a single class.
Section
5.5 Preferred Stock — Directors. Notwithstanding any other provision of this Article V,
and except as otherwise required by law, whenever the holders of one or more series of the Preferred Stock shall have the right, voting
separately by class or series, to elect one or more directors, the term of office, the filling of vacancies, the removal from office and
other features of such directorships shall be governed by the terms of such series of the Preferred Stock as set forth in this Second
Amended and Restated Certificate (including any Preferred Stock Designation).
ARTICLE
VI
BYLAWS
In
furtherance and not in limitation of the powers conferred upon it by law, the Board is expressly authorized to adopt, amend, alter or
repeal the Bylaws. The Bylaws also may be adopted, amended, altered or repealed by the stockholders of the Corporation; provided, however,
that in addition to any vote of the holders of any class or series of capital stock of the Corporation required by law or by this Second
Amended and Restated Certificate, the affirmative vote of the holders of at least a majority of the voting power of all then outstanding
shares of capital stock of the Corporation entitled to vote generally in the election of directors, voting together as a single class,
shall be required for the stockholders of the Corporation to adopt, amend, alter or repeal the Bylaws; and provided, further,
however, that no Bylaws hereafter adopted by the stockholders of the Corporation shall invalidate any prior act of the Board that would
have been valid if such Bylaws had not been adopted.
ARTICLE
VII
SPECIAL MEETINGS OF STOCKHOLDERS; ACTION BY WRITTEN CONSENT
Section
7.1 Special Meetings. Subject to the rights, if any, of the holders of any outstanding series of the Preferred Stock,
and to the requirements of applicable law, special meetings of stockholders of the Corporation may be called only by the Chairman of the
Board, the Chief Executive Officer of the Corporation or the Board pursuant to a resolution adopted by the Board, and the ability of the
stockholders of the Corporation to call a special meeting is hereby specifically denied. Except as provided in the foregoing sentence,
special meetings of stockholders of the Corporation may not be called by any other person or persons.
Section
7.2 Advance Notice. Advance notice of stockholder nominations for the election of directors and of business to be
brought by stockholders before any meeting of the stockholders of the Corporation shall be given in the manner provided in the Bylaws.
Section
7.3 Action by Written Consent. Except as may be otherwise provided for or fixed pursuant to this Amended and Restated
Certificate (including any Preferred Stock Designation) relating to the rights of the holders of any outstanding series of Preferred Stock,
any action required or permitted to be taken by stockholders of the Corporation must be effected at a duly called annual or special meeting
of the stockholders and may not be effected by written consent in lieu of a meeting.
ARTICLE
VIII
LIMITED LIABILITY; INDEMNIFICATION
Section
8.1 Limitation of Director Liability. A director of the Corporation shall not be personally liable to the Corporation
or its stockholders for monetary damages for breach of fiduciary duty as a director, except to the extent such exemption from liability
or limitation thereof is not permitted under the DGCL as the same exists or may hereafter be amended unless a director violated his or
her duty of loyalty to the Corporation or its stockholders, acted in bad faith, knowingly or intentionally violated the law, authorized
unlawful payments of dividends, unlawful stock purchases or unlawful redemptions, or derived improper personal benefit from its actions
as a director. Any amendment, modification or repeal of the foregoing sentence shall not adversely affect any right or protection of a
director of the Corporation hereunder in respect of any act or omission occurring prior to the time of such amendment, modification or
repeal.
Section
8.2 Indemnification and Advancement of Expenses.
(a)
To the fullest extent permitted by applicable law, as the same exists or may hereafter be amended, the Corporation shall indemnify and
hold harmless each person who is or was made a party or is threatened to be made a party to or is otherwise involved in any threatened,
pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (a “proceeding”)
by reason of the fact that he or she is or was a director or officer of the Corporation or, while a director or officer of the Corporation,
is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation or of a partnership,
joint venture, trust, other enterprise or nonprofit entity, including service with respect to an employee benefit plan (an “indemnitee”),
whether the basis of such proceeding is alleged action in an official capacity as a director, officer, employee or agent, or in any other
capacity while serving as a director, officer, employee or agent, against all liability and loss suffered and expenses (including, without
limitation, attorneys’ fees, judgments, fines, ERISA excise taxes and penalties and amounts paid in settlement) reasonably incurred
by such indemnitee in connection with such proceeding. The Corporation shall to the fullest extent not prohibited by applicable law pay
the expenses (including attorneys’ fees) incurred by an indemnitee in defending or otherwise participating in any proceeding in
advance of its final disposition; provided, however, that, to the extent required by applicable law, such payment of expenses in advance
of the final disposition of the proceeding shall be made only upon receipt of an undertaking, by or on behalf of the indemnitee, to repay
all amounts so advanced if it shall ultimately be determined that the indemnitee is not entitled to be indemnified under this Section
8.2 or otherwise. The rights to indemnification and advancement of expenses conferred by this Section 8.2 shall
be contract rights and such rights shall continue as to an indemnitee who has ceased to be a director, officer, employee or agent and
shall inure to the benefit of his or her heirs, executors and administrators. Notwithstanding the foregoing provisions of this Section
8.2(a), except for proceedings to enforce rights to indemnification and advancement of expenses, the Corporation shall indemnify and
advance expenses to an indemnitee in connection with a proceeding (or part thereof) initiated by such indemnitee only if such proceeding
(or part thereof) was authorized by the Board.
(b)
The rights to indemnification and advancement of expenses conferred on any indemnitee by this Section 8.2 shall not be
exclusive of any other rights that any indemnitee may have or hereafter acquire under law, this Second Amended and Restated Certificate,
the Bylaws, an agreement, vote of stockholders or disinterested directors, or otherwise.
(c)
Any repeal or amendment of this Section 8.2 by the stockholders of the Corporation or by changes in law, or the adoption
of any other provision of this Second Amended and Restated Certificate inconsistent with this Section 8.2, shall, unless otherwise
required by law, be prospective only (except to the extent such amendment or change in law permits the Corporation to provide broader
indemnification rights on a retroactive basis than permitted prior thereto), and shall 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 in respect of any proceeding
(regardless of when such proceeding is first threatened, commenced or completed) arising out of, or related to, any act or omission occurring
prior to such repeal or amendment or adoption of such inconsistent provision.
(d)
This Section 8.2 shall not limit the right of the Corporation, to the extent and in the manner authorized or permitted
by law, to indemnify and to advance expenses to persons other than indemnitees.
ARTICLE
IX
CORPORATE OPPORTUNITY
The
Corporation renounces any interest or expectancy of the Corporation in, or in being offered an opportunity to participate in, any Excluded
Opportunity. An “Excluded Opportunity” is any matter, transaction or interest that is presented to, or acquired,
created or developed by, or which otherwise comes into the possession of, any director of the Corporation who is not an employee or officer
of the Corporation or any of its subsidiaries (a “Covered Person”), unless such matter, transaction or interest
is presented to, or acquired, created or developed by, or otherwise comes into the possession of, a Covered Person expressly and solely
in such Covered Person’s capacity as a director of the Corporation.
ARTICLE
X
ANTITAKEOVER
The
Corporation expressly elects not to be governed by Section 203 of the DGCL.
ARTICLE
XI
AMENDMENT OF SECOND AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
THE
CORPORATION RESERVES THE RIGHT TO AMEND, ALTER, CHANGE OR REPEAL ANY PROVISION CONTAINED IN THIS SECONDED AMENDED AND RESTATED CERTIFICATE
OF INCORPORATION (INCLUDING ANY RIGHTS, PREFERENCES OR OTHER DESIGNATIONS OF PREFERRED STOCK), IN THE MANNER NOW OR HEREAFTER PRESCRIBED
BY THIS SECONDED AMENDED AND RESTATED CERTIFICATE OF INCORPORATION AND THE DGCL; AND ALL RIGHTS, PREFERENCES AND PRIVILEGES HEREIN CONFERRED
UPON STOCKHOLDERS BY AND PURSUANT TO THIS SECONDED AMENDED AND RESTATED CERTIFICATE OF INCORPORATION IN ITS PRESENT FORM OR AS HEREAFTER
AMENDED ARE GRANTED SUBJECT TO THE RIGHT RESERVED IN THIS ARTICLE IX.
ARTICLE
XII
EXCLUSIVE FORUM FOR CERTAIN LAWSUITS
Section
12.1 Forum. Unless the Corporation consents in writing to the selection of an alternative forum, the Court of Chancery
of the State of Delaware shall be the sole and exclusive forum for any stockholder (including a beneficial owner) to bring (i) any derivative
action or proceeding brought on behalf of the Corporation, (ii) any action asserting a claim of breach of a fiduciary duty owed by any
director, officer or other employee of the Corporation to the Corporation or the Corporation’s stockholders, (iii) any action asserting
a claim against the Corporation, its directors, officers or employees arising pursuant to any provision of the DGCL or this Second Amended
and Restated Certificate or the Bylaws, or (iv) any action asserting a claim against the Corporation, its directors, officers or employees
governed by the internal affairs doctrine and, if brought outside of Delaware, the stockholder bringing the suit will be deemed to have
consented to service of process on such stockholder’s counsel except any action (A) as to which the Court of Chancery in the State
of Delaware determines that there is an indispensable party not subject to the jurisdiction of the Court of Chancery (and the indispensable
party does not consent to the personal jurisdiction of the Court of Chancery within ten days following such determination), (B) which
is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery, (C) for which the Court of Chancery does
not have subject matter jurisdiction, or (D) any action arising under the Securities Act of 1933, as amended, as to which the Court of
Chancery and the federal district court for the District of Delaware shall have concurrent jurisdiction. Notwithstanding the foregoing,
the provisions of this Section 12.1 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 courts have exclusive jurisdiction.
Section
12.2 Consent to Jurisdiction. If any action the subject matter of which is within the scope of Section 12.1 immediately
above 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 (i) 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 Section 12.1 immediately
above (an “FSC Enforcement Action”) and (ii) having service of process made upon such stockholder in any such
FSC Enforcement Action by service upon such stockholder’s counsel in the Foreign Action as agent for such stockholder.
ARTICLE
XIII
SEVERABILITY
If
any provision or provisions (or any part thereof) of this Second Amended and Restated Certificate shall be held to be invalid, illegal
or unenforceable as applied to any person, entity or circumstance for any reason whatsoever, then, to the fullest extent permitted by
law, (i) the validity, legality and enforceability of such provisions in any other circumstance and of the remaining provisions of this
Second Amended and Restated Certificate (including, without limitation, each portion of any paragraph of this Second Amended and Restated
Certificate containing any such provision held to be invalid, illegal or unenforceable that is not itself held to be invalid, illegal
or unenforceable) and the application of such provision to other persons or entities and circumstances shall not in any way be affected
or impaired thereby, and (ii) the provisions of this Second Amended and Restated Certificate (including, without limitation, each portion
of any paragraph of this Second Amended and Restated Certificate containing any such provision held to be invalid, illegal or unenforceable)
shall be construed so as to permit the Corporation to protect its directors, officers, employees and agents from personal liability in
respect of their good faith service or for the benefit of the Corporation to the fullest extent permitted by law.
[Signature page follows.]
IN
WITNESS WHEREOF, Abri SPAC I, Inc. has caused this Second Amended and Restated Certificate to be duly executed and acknowledged in
its name and on its behalf by an authorized officer as of the date first set forth above.
| |
Abri SPAC I, Inc. |
| |
|
| |
By: |
|
|
| |
Name: |
|
|
| |
Title: |
|
|
Signature Page to Second
Amended and Restated Certificate of Incorporation
Exhibit H
AMENDED AND RESTATED
BYLAWS
OF
DATALOGIQ, INC.
(THE “CORPORATION”)
ARTICLE
I
OFFICES
Section
1.1 Registered Office. The registered office of the Corporation within the State of Delaware shall be located at either (a) the principal
place of business of the Corporation in the State of Delaware or (b) the office of the corporation or individual acting as the Corporation’s
registered agent in Delaware.
Section
1.2 Additional Offices. The Corporation may, in addition to its registered office in the State of Delaware, have such other offices
and places of business, both within and outside the State of Delaware, as the Board of Directors of the Corporation (the “Board”)
may from time to time determine or as the business and affairs of the Corporation may require.
ARTICLE
II
STOCKHOLDERS
Section
2.1 Annual Meetings. The annual meeting of stockholders shall be held at such place, either within or without the State of Delaware
and time and on such date as shall be determined by the Board and stated in the notice of the meeting; provided, that the
Board may in its sole discretion determine that the meeting shall not be held at any place, but may instead be held solely by means of
remote communication pursuant to Section 9.5(a). At each annual meeting, the stockholders entitled to vote on such matters
shall elect those directors of the Corporation to fill any term of a directorship that expires on the date of such annual meeting and
may transact any other business as may properly be brought before the meeting.
Section
2.2 Special Meetings. Subject to the requirements of applicable law, special meetings of stockholders of the Corporation may be called
only by the Chairman of the Board, the Chief Executive Officer of the Corporation or the Board pursuant to a resolution adopted by the
Board, and the ability of the stockholders of the Corporation to call a special meeting is hereby specifically denied. Except as provided
in the foregoing sentence, special meetings of stockholders of the Corporation may not be called by any other person or persons. Special
meetings of stockholders shall be held at such place, either within or without the State of Delaware, and at such and time and on such
date as shall be determined by the Board and stated in the Corporation’s notice of the meeting; provided, that the Board
may in its sole discretion determine that the meeting shall not be held at any place, but may instead be held solely by means of remote
communication pursuant to Section 9.5(a).
Section
2.3 Notices. Written notice of each stockholders meeting stating the place, if any, date, and time of the meeting, and the means of
remote communication, if any, by which stockholders and proxy holders may be deemed to be present in person and vote at such meeting and
the record date for determining the stockholders entitled to vote at the meeting, if such date is different from the record date for determining
stockholders entitled to notice of the meeting, shall be given in the manner permitted by Section 9.3 to each stockholder
entitled to vote thereat as of the record date for determining the stockholders entitled to notice of the meeting, by the Corporation
not less than 10 nor more than 60 days before the date of the meeting unless otherwise required by the General Corporation Law of the
State of Delaware (the “DGCL”). If said notice is for a stockholders meeting other than an annual meeting, it
shall in addition state the purpose or purposes for which the meeting is called, and the business transacted at such meeting shall be
limited to the matters so stated in the Corporation’s notice of meeting (or any supplement thereto). Any meeting of stockholders
as to which notice has been given may be postponed, and any meeting of stockholders as to which notice has been given may be cancelled,
by the Board upon public announcement (as defined in Section 2.7(c)) given before the date previously scheduled for such meeting.
Section
2.4 Quorum. Except as otherwise provided by applicable law, the Corporation’s Second Amended and Restated Certificate of Incorporation,
as the same may be amended or restated from time to time (the “Certificate of Incorporation”) or these Bylaws,
the presence, in person or by proxy, at a stockholders meeting of the holders of shares of outstanding capital stock of the Corporation
representing a majority of the voting power of all outstanding shares of capital stock of the Corporation entitled to vote at such meeting
shall constitute a quorum for the transaction of business at such meeting, except that when specified business is to be voted on by a
class or series of stock voting as a class, the holders of shares representing a majority of the voting power of the outstanding shares
of such class or series shall constitute a quorum of such class or series for the transaction of such business. If a quorum shall not
be present or represented by proxy at any meeting of the stockholders of the Corporation, the chairman of the meeting may adjourn the
meeting from time to time in the manner provided in Section 2.6 until a quorum shall attend. The stockholders present
at a duly convened meeting may continue to transact business until adjournment, notwithstanding the withdrawal of enough stockholders
to leave less than a quorum. Shares of its own stock belonging to the Corporation or to another corporation, if a majority of the voting
power of the shares entitled to vote in the election of directors of such other corporation is held, directly or indirectly, by the Corporation,
shall neither be entitled to vote nor be counted for quorum purposes; provided, however, that the foregoing shall
not limit the right of the Corporation or any such other corporation to vote shares held by it in a fiduciary capacity.
Section
2.5 Voting of Shares.
(a) Voting
Lists. The Secretary of the Corporation (the “Secretary”) shall prepare, or shall cause the officer or agent
who has charge of the stock ledger of the Corporation to prepare and make, at least 10 days before every meeting of stockholders, a complete
list of the stockholders of record entitled to vote at such meeting; provided, however, that if the record date
for determining the stockholders entitled to vote is less than 10 days before the meeting date, the list shall reflect the stockholders
entitled to vote as of the tenth day before the meeting date, arranged in alphabetical order and showing the address and the number and
class of shares registered in the name of each stockholder. Nothing contained in this Section 2.5(a) shall require the
Corporation to include electronic mail addresses or other electronic contact information on such list. Such list shall be open to the
examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours for a period of at least 10 days
prior to the meeting: (i) on a reasonably accessible electronic network, provided that the information required to gain access to such
list is provided with the notice of the meeting, or (ii) during ordinary business hours, at the principal place of business of the Corporation.
In the event that the Corporation determines to make the list available on an electronic network, the Corporation may take reasonable
steps to ensure that such information is available only to stockholders of the Corporation. If the meeting is to be held at a place, then
the list shall be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder
who is present. If a meeting of stockholders is to be held solely by means of remote communication as permitted by Section 9.5(a),
the list shall be open to the examination of any stockholder during the whole time of the meeting on a reasonably accessible electronic
network, and the information required to access such list shall be provided with the notice of meeting. The stock ledger shall be the
only evidence as to who are the stockholders entitled to examine the list required by this Section 2.5(a) or to vote
in person or by proxy at any meeting of stockholders.
(b) Manner
of Voting. At any stockholders meeting, every stockholder entitled to vote may vote in person or by proxy. If authorized by the Board,
the voting by stockholders or proxy holders at any meeting conducted by remote communication may be effected by a ballot submitted by
electronic transmission (as defined in Section 9.3), provided, that any such electronic transmission must either
set forth or be submitted with information from which the Corporation can determine that the electronic transmission was authorized by
the stockholder or proxy holder. The Board, in its discretion, or the chairman of the meeting of stockholders, in such person’s
discretion, may require that any votes cast at such meeting shall be cast by written ballot.
(c) Proxies.
Each stockholder entitled to vote at a meeting of stockholders or to express consent or dissent to corporate action in writing without
a meeting may authorize another person or persons to act for such stockholder by proxy, but no such proxy shall be voted or acted upon
after three years from its date, unless the proxy provides for a longer period. Proxies need not be filed with the Secretary until the
meeting is called to order, but shall be filed with the Secretary before being voted. Without limiting the manner in which a stockholder
may authorize another person or persons to act for such stockholder as proxy, either of the following shall constitute a valid means by
which a stockholder may grant such authority. No stockholder shall have cumulative voting rights.
(i)
A stockholder may execute a writing authorizing another person or persons to act for such stockholder as proxy. Execution may be accomplished
by the stockholder or such stockholder’s authorized officer, director, employee or agent signing such writing or causing such person’s
signature to be affixed to such writing by any reasonable means, including, but not limited to, by facsimile signature.
(ii)
A stockholder may authorize another person or persons to act for such stockholder as proxy by transmitting or authorizing the transmission
of an electronic transmission to the person who will be the holder of the proxy or to a proxy solicitation firm, proxy support service
organization or like agent duly authorized by the person who will be the holder of the proxy to receive such transmission, provided,
that any such electronic transmission must either set forth or be submitted with information from which it can be determined that the
electronic transmission was authorized by the stockholder. Any copy, facsimile telecommunication or other reliable reproduction of the
writing or transmission authorizing another person or persons to act as proxy for a stockholder may be substituted or used in lieu of
the original writing or transmission for any and all purposes for which the original writing or transmission could be used; provided,
that such copy, facsimile telecommunication or other reproduction shall be a complete reproduction of the entire original writing or transmission.
(d) Required
Vote. At all meetings of stockholders at which a quorum is present, the election of directors shall be determined by a plurality of
the votes cast by the stockholders present in person or represented by proxy at the meeting and entitled to vote thereon. All other matters
presented to the stockholders at a meeting at which a quorum is present shall be determined by the vote of a majority of the votes cast
by the stockholders present in person or represented by proxy at the meeting and entitled to vote thereon, unless the matter is one upon
which, by applicable law, the Certificate of Incorporation, these Bylaws or applicable stock exchange rules, a different vote is required,
in which case such provision shall govern and control the decision of such matter.
(e) Inspectors
of Election. The Board may, and shall if required by law, in advance of any meeting of stockholders, designate one or more persons
as inspectors of election, who may be employees of the Corporation or otherwise serve the Corporation in other capacities, to act at such
meeting of stockholders or any adjournment thereof and to make a written report thereof. The Board may appoint one or more persons as
alternate inspectors to replace any inspector who fails to act. If no inspectors of election or alternates are appointed by the Board,
the chairman of the meeting shall appoint one or more inspectors to act at the meeting. Each inspector, before discharging his or her
duties, shall take and sign an oath faithfully to execute the duties of inspector with strict impartiality and according to the best of
his or her ability. The inspectors shall ascertain and report the number of outstanding shares and the voting power of each; determine
the number of shares present in person or represented by proxy at the meeting and the validity of proxies and ballots; count all votes
and ballots and report the results; determine and retain for a reasonable period a record of the disposition of any challenges made to
any determination by the inspectors; and certify their determination of the number of shares represented at the meeting and their count
of all votes and ballots. No person who is a candidate for an office at an election may serve as an inspector at such election. Each report
of an inspector shall be in writing and signed by the inspector or by a majority of them if there is more than one inspector acting at
such meeting. If there is more than one inspector, the report of a majority shall be the report of the inspectors.
Section
2.6 Adjournments. Any meeting of stockholders, annual or special, may be adjourned by the chairman of the meeting, from time to time,
whether or not there is a quorum, to reconvene at the same or some other place. Notice need not be given of any such adjourned meeting
if the date, time, and place, if any, thereof, and the means of remote communication, if any, by which stockholders and proxy holders
may be deemed to be present in person and vote at such adjourned meeting are announced at the meeting at which the adjournment is taken.
At the adjourned meeting the stockholders, or the holders of any class or series of stock entitled to vote separately as a class, as the
case may be, may transact any business that might have been transacted at the original meeting. If the adjournment is for more than 30
days, notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting. If after the adjournment
a new record date for stockholders entitled to vote is fixed for the adjourned meeting, the Board shall fix a new record date for notice
of such adjourned meeting in accordance with Section 9.2, and shall give notice of the adjourned meeting to each stockholder
of record entitled to vote at such adjourned meeting as of the record date fixed for notice of such adjourned meeting.
Section
2.7 Advance Notice for Business.
(a) Annual
Meetings of Stockholders. No business may be transacted at an annual meeting of stockholders, other than business that is either (i)
specified in the Corporation’s notice of meeting (or any supplement thereto) given by or at the direction of the Board, (ii) otherwise
properly brought before the annual meeting by or at the direction of the Board or (iii) otherwise properly brought before the annual meeting
by any stockholder of the Corporation (x) who is a stockholder of record entitled to vote at such annual meeting on the date of the
giving of the notice provided for in this Section 2.7(a) and on the record date for the determination of stockholders
entitled to vote at such annual meeting and (y) who complies with the notice procedures set forth in this Section 2.7(a).
Notwithstanding anything in this Section 2.7(a) to the contrary, only persons nominated for election as a director to
fill any term of a directorship that expires on the date of the annual meeting pursuant to Section 3.2 will be considered
for election at such meeting.
(i)
In addition to any other applicable requirements, for business (other than nominations) to be properly brought before an annual meeting
by a stockholder, such stockholder must have given timely notice thereof in proper written form to the Secretary and such business must
otherwise be a proper matter for stockholder action. Subject to Section 2.7(a)(iii), a stockholder’s notice to the Secretary
with respect to such business, to be timely, must be received by the Secretary at the principal executive offices of the Corporation not
later than the close of business on the 90th day nor earlier than the opening of business on the 120th day
before the anniversary date of the immediately preceding annual meeting of stockholders; provided, however, that
in the event that the annual meeting is called for a date that is not within 30 days before or after such anniversary date, notice by
the stockholder to be timely must be so received not earlier than the opening of business on the 120th day before
the meeting and not later than the later of (x) the close 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 the Corporation. The public announcement of an adjournment of an annual meeting shall not commence a new time period for
the giving of a stockholder’s notice as described in this Section 2.7(a).
(ii)
To be in proper written form, a stockholder’s notice to the Secretary with respect to any business (other than nominations) must
set forth as to each such matter such stockholder proposes to bring before the annual meeting (A) a brief description of the business
desired to be brought before the annual meeting, the text of the proposal or business (including the text of any resolutions proposed
for consideration and in the event such business includes a proposal to amend these Bylaws, the language of the proposed amendment) and
the reasons for conducting such business at the annual meeting, (B) the name and record address of such stockholder and the name and address
of the beneficial owner, if any, on whose behalf the proposal is made, (C) the class or series and number of shares of capital stock of
the Corporation that are owned beneficially and of record by such stockholder and by the beneficial owner, if any, on whose behalf the
proposal is made, (D) a description of all arrangements or understandings between such stockholder and the beneficial owner, if any, on
whose behalf the proposal is made and any other person or persons (including their names) in connection with the proposal of such business
by such stockholder, (E) any material interest of such stockholder and the beneficial owner, if any, on whose behalf the proposal is made
in such business and (F) a representation that such stockholder (or a qualified representative of such stockholder) intends to appear
in person or by proxy at the annual meeting to bring such business before the meeting.
(iii)
The foregoing notice requirements of this Section 2.7(a) shall be deemed satisfied by a stockholder as to any proposal
(other than nominations) if the stockholder has notified the Corporation of such stockholder’s intention to present such proposal
at an annual meeting in compliance with Rule 14a-8 (or any successor thereof) of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), and such stockholder has complied with the requirements of such rule for inclusion of such
proposal in a proxy statement prepared by the Corporation to solicit proxies for such annual meeting. No business shall be conducted at
the annual meeting of stockholders except business brought before the annual meeting in accordance with the procedures set forth in this Section
2.7(a), provided, however, that once business has been properly brought before the annual meeting in accordance
with such procedures, nothing in this Section 2.7(a) shall be deemed to preclude discussion by any stockholder of any
such business. If the Board or the chairman of the annual meeting determines that any stockholder proposal was not made in accordance
with the provisions of this Section 2.7(a) or that the information provided in a stockholder’s notice does not
satisfy the information requirements of this Section 2.7(a), such proposal shall not be presented for action at the annual
meeting. Notwithstanding the foregoing provisions of this Section 2.7(a), if the stockholder (or a qualified representative
of the stockholder) does not appear at the annual meeting of stockholders of the Corporation to present the proposed business, such proposed
business shall not be transacted, notwithstanding that proxies in respect of such matter may have been received by the Corporation.
(iv)
In addition to the provisions of this Section 2.7(a), a stockholder shall also comply with all applicable requirements of
the Exchange Act and the rules and regulations thereunder with respect to the matters set forth herein. Nothing in this Section
2.7(a) shall be deemed to affect any rights of stockholders to request inclusion of proposals in the Corporation’s proxy
statement pursuant to Rule 14a-8 under the Exchange Act.
(b) Special
Meetings of Stockholders. Only such business shall be conducted at a special meeting of stockholders as shall have been brought before
the meeting pursuant to the Corporation’s notice of meeting. Nominations of persons for election to the Board may be made at a special
meeting of stockholders at which directors are to be elected pursuant to the Corporation’s notice of meeting only pursuant to Section
3.2.
(c) Public
Announcement. For purposes of these Bylaws, “public announcement” shall mean disclosure in a press release
reported by the Dow Jones News Service, Associated Press or comparable national news service or in a document publicly filed by the Corporation
with the Securities and Exchange Commission pursuant to Sections 13, 14 or 15(d) of the Exchange Act (or any successor thereto).
Section
2.8 Conduct of Meetings. The chairman of each annual and special meeting of stockholders shall be the Chairman of the Board or, in
the absence (or inability or refusal to act) of the Chairman of the Board, the Chief Executive Officer (if he or she shall be a director)
or, in the absence (or inability or refusal) to act of the Chief Executive Officer or if the Chief Executive Officer is not a director,
the President (if he or she shall be a director) or, in the absence (or inability or refusal to act) of the President or if the President
is not a director, such other person as shall be appointed by the Board. The date and time of the opening and the closing of the polls
for each matter upon which the stockholders will vote at a meeting shall be announced at the meeting by the chairman of the meeting. The
Board may adopt such rules and regulations for the conduct of the meeting of stockholders as it shall deem appropriate. Except to the
extent inconsistent with these Bylaws or such rules and regulations as adopted by the Board, the chairman of any meeting of stockholders
shall have the right and authority to convene and to adjourn the meeting, to prescribe such rules, regulations and procedures and to do
all such acts as, in the judgment of such chairman, are appropriate for the proper conduct of the meeting. Such rules, regulations or
procedures, whether adopted by the Board or prescribed by the chairman of the meeting, may include, without limitation, the following:
(a) the establishment of an agenda or order of business for the meeting; (b) rules and procedures for maintaining order at the meeting
and the safety of those present; (c) limitations on attendance at or participation in the meeting to stockholders of record of the Corporation,
their duly authorized and constituted proxies or such other persons as the chairman of the meeting shall determine; (d) restrictions on
entry to the meeting after the time fixed for the commencement thereof; and (e) limitations on the time allotted to questions or
comments by participants. Unless and to the extent determined by the Board or the chairman of the meeting, meetings of stockholders shall
not be required to be held in accordance with the rules of parliamentary procedure. The secretary of each annual and special meeting of
stockholders shall be the Secretary or, in the absence (or inability or refusal to act) of the Secretary, an Assistant Secretary so appointed
to act by the chairman of the meeting. In the absence (or inability or refusal to act) of the Secretary and all Assistant Secretaries,
the chairman of the meeting may appoint any person to act as secretary of the meeting.
Section
2.9 Consents in Lieu of Meeting. Any action required or permitted to be taken by the stockholders of the Corporation may be effected
by written consent of the stockholders. Every written consent shall bear the date of signature of each stockholder who signs the consent,
and no written consent shall be effective to take the corporate action referred to therein unless, within 60 days of the earliest dated
consent delivered in the manner required by this section and the DGCL to the Corporation, written consents signed by a sufficient number
of holders entitled to vote to take action are delivered to the Corporation by delivery to its registered office in Delaware, its principal
place of business or an officer or agent of the Corporation having custody of the book in which proceedings of meetings of stockholders
are recorded. Delivery made to the Corporation’s registered office shall be by hand or by certified or registered mail, return receipt
requested.
ARTICLE
III
DIRECTORS
Section
3.1 Powers. The business and affairs of the Corporation shall be managed by or under the direction of the Board, which may exercise
all such powers of the Corporation and do all such lawful acts and things as are not by statute or by the Certificate of Incorporation
or by these Bylaws required to be exercised or done by the stockholders. Directors need not be stockholders or residents of the State
of Delaware.
Section
3.2 Advance Notice for Nomination of Directors.
(a)
Only persons who are nominated in accordance with the following procedures shall be eligible for election as directors of the Corporation.
Nominations of persons for election to the Board at any annual meeting of stockholders, or at any special meeting of stockholders called
for the purpose of electing directors as set forth in the Corporation’s notice of such special meeting, may be made (i) by or at
the direction of the Board or (ii) by any stockholder of the Corporation (x) who is a stockholder of record entitled to vote in the election
of directors on the date of the giving of the notice provided for in this Section 3.2 and on the record date for the
determination of stockholders entitled to vote at such meeting and (y) who complies with the notice procedures set forth in this Section
3.2.
(b)
In addition to any other applicable requirements, for a nomination to be made by a stockholder, such stockholder must have given timely
notice thereof in proper written form to the Secretary. To be timely, a stockholder’s notice to the Secretary must be received by
the Secretary at the principal executive offices of the Corporation (i) in the case of an annual meeting, not later than the close of
business on the 90th day nor earlier than the opening of business on the 120th day before the anniversary
date of the immediately preceding annual meeting of stockholders; provided, however, that in the event that the
annual meeting is called for a date that is not within 30 days before or after such anniversary date, notice by the stockholder to be
timely must be so received not earlier than the opening of business on the 120th day before the meeting and not later
than the later of (x) the close 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 was first made by the Corporation; and (ii) in the case
of a special meeting of stockholders called for the purpose of electing directors, not later than the close of business on the 10th day
following the day on which public announcement of the date of the special meeting is first made by the Corporation. In no event shall
the public announcement of an adjournment or postponement of an annual meeting or special meeting commence a new time period (or extend
any time period) for the giving of a stockholder’s notice as described in this Section 3.2.
(c)
Notwithstanding anything in paragraph (b) to the contrary, in the event that the number of directors to be elected to the Board at an
annual meeting is greater than the number of directors whose terms expire on the date of the annual meeting and there is no public announcement
by the Corporation naming all of the nominees for the additional directors to be elected or specifying the size of the increased Board
before the close of business on the 90th day prior to the anniversary date of the immediately preceding annual meeting
of stockholders, a stockholder’s notice required by this Section 3.2 shall also be considered timely, but only
with respect to nominees for the additional directorships created by such increase that are to be filled by election at such annual meeting,
if it shall be received by the Secretary at the principal executive offices of the Corporation not later than the close of business on
the 10th day following the date on which such public announcement was first made by the Corporation.
(d)
To be in proper written form, a stockholder’s notice to the Secretary must set forth (i) as to each person whom the stockholder
proposes to nominate for election as a director (A) the name, age, business address and residence address of the person, (B) the principal
occupation or employment of the person, (C) the class or series and number of shares of capital stock of the Corporation that are owned
beneficially or of record by the person and (D) any other information relating to the person that would be required to be disclosed in
a proxy statement or other filings required to be made in connection with solicitations of proxies for election of directors pursuant
to Section 14 of the Exchange Act and the rules and regulations promulgated thereunder; and (ii) as to the stockholder giving the
notice (A) the name and record address of such stockholder as they appear on the Corporation’s books and the name and address of
the beneficial owner, if any, on whose behalf the nomination is made, (B) the class or series and number of shares of capital stock of
the Corporation that are owned beneficially and of record by such stockholder and the beneficial owner, if any, on whose behalf the nomination
is made, (C) a description of all arrangements or understandings relating to the nomination to be made by such stockholder among such
stockholder, the beneficial owner, if any, on whose behalf the nomination is made, each proposed nominee and any other person or persons
(including their names), (D) a representation that such stockholder (or a qualified representative of such stockholder) intends to appear
in person or by proxy at the meeting to nominate the persons named in its notice and (E) any other information relating to such stockholder
and the beneficial owner, if any, on whose behalf the nomination is made that would be required to be disclosed in a proxy statement or
other filings required to be made in connection with solicitations of proxies for election of directors pursuant to Section 14 of the
Exchange Act and the rules and regulations promulgated thereunder. Such notice must be accompanied by a written consent of each proposed
nominee to being named as a nominee and to serve as a director if elected.
(e)
If the Board or the chairman of the meeting of stockholders determines that any nomination was not made in accordance with the provisions
of this Section 3.2, or that the information provided in a stockholder’s notice does not satisfy the information requirements
of this Section 3.2, then such nomination shall not be considered at the meeting in question. Notwithstanding the foregoing
provisions of this Section 3.2, if the stockholder (or a qualified representative of the stockholder) does not appear at the
meeting of stockholders of the Corporation to present the nomination, such nomination shall be disregarded, notwithstanding that proxies
in respect of such nomination may have been received by the Corporation.
(f)
In addition to the provisions of this Section 3.2, a stockholder shall also comply with all of the applicable requirements
of the Exchange Act and the rules and regulations thereunder with respect to the matters set forth herein.
Section
3.3 Compensation. Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, the Board shall have the authority
to fix the compensation of directors. The directors may be reimbursed their expenses, if any, of attendance at each meeting of the Board,
including for service on a committee of the Board, and may be paid either a fixed sum for attendance at each meeting of the Board or other
compensation as director. No such payment shall preclude any director from serving the Corporation in any other capacity and receiving
compensation therefor. Members of committees of the Board may be allowed like compensation and reimbursement of expenses for service on
the committee.
ARTICLE
IV
BOARD MEETINGS
Section
4.1 Annual Meetings. The Board shall meet as soon as practicable after the adjournment of each annual stockholders meeting at the
place of the annual stockholders meeting unless the Board shall fix another time and place and give notice thereof in the manner required
herein for special meetings of the Board. No notice to the directors shall be necessary to legally convene this meeting, except as provided
in this Section 4.1.
Section
4.2 Regular Meetings. Regularly scheduled, periodic meetings of the Board may be held without notice at such times, dates and places
(within or without the State of Delaware) as shall from time to time be determined by the Board.
Section
4.3 Special Meetings. Special meetings of the Board (a) may be called by the Chairman of the Board or President and (b) shall be called
by the Chairman of the Board, President or Secretary on the written request of at least a majority of directors then in office, or the
sole director, as the case may be, and shall be held at such time, date and place (within or without the State of Delaware) as may be
determined by the person calling the meeting or, if called upon the request of directors or the sole director, as specified in such written
request. Notice of each special meeting of the Board shall be given, as provided in Section 9.3, to each director (i) at least
24 hours before the meeting if such notice is oral notice given personally or by telephone or written notice given by hand delivery or
by means of a form of electronic transmission and delivery; (ii) at least two days before the meeting if such notice is sent by a nationally
recognized overnight delivery service; and (iii) at least five days before the meeting if such notice is sent through the United States
mail. If the Secretary shall fail or refuse to give such notice, then the notice may be given by the officer who called the meeting or
the directors who requested the meeting. Any and all business that may be transacted at a regular meeting of the Board may be transacted
at a special meeting. Except as may be otherwise expressly provided by applicable law, the Certificate of Incorporation, or these Bylaws,
neither the business to be transacted at, nor the purpose of, any special meeting need be specified in the notice or waiver of notice
of such meeting. A special meeting may be held at any time without notice if all the directors are present or if those not present waive
notice of the meeting in accordance with Section 9.4.
Section
4.4 Quorum; Required Vote. A majority of the Board shall constitute a quorum for the transaction of business at any meeting of the
Board, and the act of a majority of the directors present at any meeting at which there is a quorum shall be the act of the Board, except
as may be otherwise specifically provided by applicable law, the Certificate of Incorporation or these Bylaws. If a quorum shall not be
present at any meeting, a majority of the directors present may adjourn the meeting from time to time, without notice other than announcement
at the meeting, until a quorum is present.
Section
4.5 Consent In Lieu of Meeting. Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, any action required
or permitted to be taken at any meeting of the Board or any committee thereof may be taken without a meeting if all members of the Board
or committee, as the case may be, consent thereto in writing or by electronic transmission, and the writing or writings or electronic
transmission or transmissions (or paper reproductions thereof) are filed with the minutes of proceedings of the Board or committee. Such
filing shall be in paper form if the minutes are maintained in paper form and shall be in electronic form if the minutes are maintained
in electronic form.
Section
4.6 Organization. The chairman of each meeting of the Board shall be the Chairman of the Board or, in the absence (or inability or
refusal to act) of the Chairman of the Board, the Chief Executive Officer (if he or she shall be a director) or, in the absence (or inability
or refusal to act) of the Chief Executive Officer or if the Chief Executive Officer is not a director, the President (if he or she shall
be a director) or in the absence (or inability or refusal to act) of the President or if the President is not a director, a chairman elected
from the directors present. The Secretary shall act as secretary of all meetings of the Board. In the absence (or inability or refusal
to act) of the Secretary, an Assistant Secretary shall perform the duties of the Secretary at such meeting. In the absence (or inability
or refusal to act) of the Secretary and all Assistant Secretaries, the chairman of the meeting may appoint any person to act as secretary
of the meeting.
ARTICLE
V
COMMITTEES OF DIRECTORS
Section
5.1 Establishment. The Board may by resolution passed by a majority of the Board designate one or more committees, each committee
to consist of one or more of the directors of the Corporation. Each committee shall keep regular minutes of its meetings and report the
same to the Board when required. The Board shall have the power at any time to fill vacancies in, to change the membership of, or to dissolve
any such committee.
Section
5.2 Available Powers. Any committee established pursuant to Section 5.1 hereof, to the extent permitted by applicable
law and by resolution of the Board, shall have and may exercise all of the powers and authority of the Board in the management of the
business and affairs of the Corporation, and may authorize the seal of the Corporation to be affixed to all papers that may require it.
Section
5.3 Alternate Members. The Board may designate one or more directors as alternate members of any committee, who may replace any absent
or disqualified member at any meeting of such committee. In the absence or disqualification of a member of the committee, the member or
members thereof present at any meeting and not disqualified from voting, whether or not he, she or they constitute a quorum, may unanimously
appoint another member of the Board to act at the meeting in place of any such absent or disqualified member.
Section
5.4 Procedures. Unless the Board otherwise provides, the time, date, place, if any, and notice of meetings of a committee shall be
determined by such committee. At meetings of a committee, a majority of the number of members of the committee (but not including any
alternate member, unless such alternate member has replaced any absent or disqualified member at the time of, or in connection with, such
meeting) shall constitute a quorum for the transaction of business. The act of a majority of the members present at any meeting at which
a quorum is present shall be the act of the committee, except as otherwise specifically provided by applicable law, the Certificate of
Incorporation, these Bylaws or the Board. If a quorum is not present at a meeting of a committee, the members present may adjourn the
meeting from time to time, without notice other than an announcement at the meeting, until a quorum is present. Unless the Board otherwise
provides and except as provided in these Bylaws, each committee designated by the Board may make, alter, amend and repeal rules for the
conduct of its business. In the absence of such rules each committee shall conduct its business in the same manner as the Board is authorized
to conduct its business pursuant to Article III and Article IV of these Bylaws.
ARTICLE
VI
OFFICERS
Section
6.1 Officers. The officers of the Corporation elected by the Board shall be a Chairman of the Board, a Chief Executive Officer, a
President, a Chief Financial Officer, a Secretary and such other officers (including without limitation, Vice Presidents, Assistant Secretaries
and a Treasurer) as the Board from time to time may determine. Officers elected by the Board shall each have such powers and duties as
generally pertain to their respective offices, subject to the specific provisions of this Article VI. Such officers shall
also have such powers and duties as from time to time may be conferred by the Board. The Chief Executive Officer or President may also
appoint such other officers (including without limitation one or more Vice Presidents and Controllers) as may be necessary or desirable
for the conduct of the business of the Corporation. Such other officers shall have such powers and duties and shall hold their offices
for such terms as may be provided in these Bylaws or as may be prescribed by the Board or, if such officer has been appointed by the Chief
Executive Officer or President, as may be prescribed by the appointing officer.
(a) Chairman
of the Board. The Chairman of the Board shall preside when present at all meetings of the stockholders and the Board. The Chairman
of the Board shall have general supervision and control of the acquisition activities of the Corporation subject to the ultimate authority
of the Board, and shall be responsible for the execution of the policies of the Board with respect to such matters. In the absence (or
inability or refusal to act) of the Chairman of the Board, the Chief Executive Officer (if he or she shall be a director) shall preside
when present at all meetings of the stockholders and the Board. The powers and duties of the Chairman of the Board shall not include supervision
or control of the preparation of the financial statements of the Corporation (other than through participation as a member of the Board).
The position of Chairman of the Board and Chief Executive Officer may be held by the same person.
(b) Chief
Executive Officer. The Chief Executive Officer shall be the chief executive officer of the Corporation, shall have general supervision
of the affairs of the Corporation and general control of all of its business subject to the ultimate authority of the Board, and shall
be responsible for the execution of the policies of the Board with respect to such matters, except to the extent any such powers and duties
have been prescribed to the Chairman of the Board pursuant to Section 6.1(a) above. In the absence (or inability or refusal
to act) of the Chairman of the Board, the Chief Executive Officer (if he or she shall be a director) shall preside when present at all
meetings of the stockholders and the Board. The position of Chief Executive Officer and President may be held by the same person.
(c) President.
The President shall make recommendations to the Chief Executive Officer on all operational matters that would normally be reserved for
the final executive responsibility of the Chief Executive Officer. In the absence (or inability or refusal to act) of the Chairman of
the Board and Chief Executive Officer, the President (if he or she shall be a director) shall preside when present at all meetings of
the stockholders and the Board. The President shall also perform such duties and have such powers as shall be designated by the Board.
The position of President and Chief Executive Officer may be held by the same person.
(d) Vice
Presidents. In the absence (or inability or refusal to act) of the President, the Vice President (or in the event there be more than
one Vice President, the Vice Presidents in the order designated by the Board) shall perform the duties and have the powers of the President.
Any one or more of the Vice Presidents may be given an additional designation of rank or function.
(e) Secretary.
(i)
The Secretary shall attend all meetings of the stockholders, the Board and (as required) committees of the Board and shall record the
proceedings of such meetings in books to be kept for that purpose. The Secretary shall give, or cause to be given, notice of all meetings
of the stockholders and special meetings of the Board and shall perform such other duties as may be prescribed by the Board, the Chairman
of the Board, Chief Executive Officer or President. The Secretary shall have custody of the corporate seal of the Corporation and the
Secretary, or any Assistant Secretary, shall have authority to affix the same to any instrument requiring it, and when so affixed, it
may be attested by his or her signature or by the signature of such Assistant Secretary. The Board may give general authority to any other
officer to affix the seal of the Corporation and to attest the affixing thereof by his or her signature.
(ii)
The Secretary shall keep, or cause to be kept, at the principal executive office of the Corporation or at the office of the Corporation’s
transfer agent or registrar, if one has been appointed, a stock ledger, or duplicate stock ledger, showing the names of the stockholders
and their addresses, the number and classes of shares held by each and, with respect to certificated shares, the number and date of certificates
issued for the same and the number and date of certificates cancelled.
(f) Assistant
Secretaries. The Assistant Secretary or, if there be more than one, the Assistant Secretaries in the order determined by the Board
shall, in the absence (or inability or refusal to act) of the Secretary, perform the duties and have the powers of the Secretary.
(g) Chief
Financial Officer. The Chief Financial Officer shall perform all duties commonly incident to that office (including, without limitation,
the care and custody of the funds and securities of the Corporation, which from time to time may come into the Chief Financial Officer’s
hands and the deposit of the funds of the Corporation in such banks or trust companies as the Board, the Chief Executive Officer or the
President may authorize).
(h) Treasurer.
The Treasurer shall, in the absence (or inability or refusal to act) of the Chief Financial Officer, perform the duties and exercise the
powers of the Chief Financial Officer.
Section
6.2 Term of Office; Removal; Vacancies. The elected officers of the Corporation shall be appointed by the Board and shall hold office
until their successors are duly elected and qualified by the Board or until their earlier death, resignation, retirement, disqualification,
or removal from office. Any officer may be removed, with or without cause, at any time by the Board. Any officer appointed by the Chief
Executive Officer or President may also be removed, with or without cause, by the Chief Executive Officer or President, as the case may
be, unless the Board otherwise provides. Any vacancy occurring in any elected office of the Corporation may be filled by the Board. Any
vacancy occurring in any office appointed by the Chief Executive Officer or President may be filled by the Chief Executive Officer, or
President, as the case may be, unless the Board then determines that such office shall thereupon be elected by the Board, in which case
the Board shall elect such officer.
Section
6.3 Other Officers. The Board may delegate the power to appoint such other officers and agents, and may also remove such officers
and agents or delegate the power to remove same, as it shall from time to time deem necessary or desirable.
Section
6.4 Multiple Officeholders; Stockholder and Director Officers. Any number of offices may be held by the same person unless the Certificate
of Incorporation or these Bylaws otherwise provide. Officers need not be stockholders or residents of the State of Delaware.
ARTICLE
VII
SHARES
Section
7.1 Certificated and Uncertificated Shares. The shares of the Corporation may be certificated or uncertificated, subject to the sole
discretion of the Board and the requirements of the DGCL.
Section
7.2 Multiple Classes of Stock. If the Corporation shall be authorized to issue more than one class of stock or more than one series
of any class, the Corporation shall (a) cause the powers, designations, preferences and relative, participating, optional or other special
rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights
to be set forth in full or summarized on the face or back of any certificate that the Corporation issues to represent shares of such class
or series of stock or (b) in the case of uncertificated shares, within a reasonable time after the issuance or transfer of such shares,
send to the registered owner thereof a written notice containing the information required to be set forth on certificates as specified
in clause (a) above; provided, however, that, except as otherwise provided by applicable law, in lieu of
the foregoing requirements, there may be set forth on the face or back of such certificate or, in the case of uncertificated shares, on
such written notice a statement that the Corporation will furnish without charge to each stockholder who so requests the powers, designations,
preferences and relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications,
limitations or restrictions of such preferences or rights.
Section
7.3 Signatures. Each certificate representing capital stock of the Corporation shall be signed by or in the name of the Corporation
by (a) the Chairman of the Board, Chief Executive Officer, the President or a Vice President and (b) the Treasurer, an Assistant Treasurer,
the Secretary or an Assistant Secretary of the Corporation. Any or all the signatures on the certificate may be a facsimile. In case any
officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased
to be such officer, transfer agent or registrar before such certificate is issued, such certificate may be issued by the Corporation with
the same effect as if such person were such officer, transfer agent or registrar on the date of issue.
Section
7.4 Consideration and Payment for Shares.
(a)
Subject to applicable law and the Certificate of Incorporation, shares of stock may be issued for such consideration, having in the case
of shares with par value a value not less than the par value thereof, and to such persons, as determined from time to time by the Board.
The consideration may consist of any tangible or intangible property or any benefit to the Corporation including cash, promissory notes,
services performed, contracts for services to be performed or other securities, or any combination thereof.
(b)
Subject to applicable law and the Certificate of Incorporation, shares may not be issued until the full amount of the consideration has
been paid, unless upon the face or back of each certificate issued to represent any partly paid shares of capital stock or upon the books
and records of the Corporation in the case of partly paid uncertificated shares, there shall have been set forth the total amount of the
consideration to be paid therefor and the amount paid thereon up to and including the time said certificate representing certificated
shares or said uncertificated shares are issued.
Section
7.5 Lost, Destroyed or Wrongfully Taken Certificates.
(a)
If an owner of a certificate representing shares claims that such certificate has been lost, destroyed or wrongfully taken, the Corporation
shall issue a new certificate representing such shares or such shares in uncertificated form if the owner: (i) requests such a new certificate
before the Corporation has notice that the certificate representing such shares has been acquired by a protected purchaser; (ii) if requested
by the Corporation, delivers to the Corporation a bond sufficient to indemnify the Corporation against any claim that may be made against
the Corporation on account of the alleged loss, wrongful taking or destruction of such certificate or the issuance of such new certificate
or uncertificated shares; and (iii) satisfies other reasonable requirements imposed by the Corporation.
(b)
If a certificate representing shares has been lost, apparently destroyed or wrongfully taken, and the owner fails to notify the Corporation
of that fact within a reasonable time after the owner has notice of such loss, apparent destruction or wrongful taking and the Corporation
registers a transfer of such shares before receiving notification, the owner shall be precluded from asserting against the Corporation
any claim for registering such transfer or a claim to a new certificate representing such shares or such shares in uncertificated form.
Section
7.6 Transfer of Stock.
(a)
If a certificate representing shares of the Corporation is presented to the Corporation with an endorsement requesting the registration
of transfer of such shares or an instruction is presented to the Corporation requesting the registration of transfer of uncertificated
shares, the Corporation shall register the transfer as requested if:
(i)
in the case of certificated shares, the certificate representing such shares has been surrendered;
(ii)
(A) with respect to certificated shares, the endorsement is made by the person specified by the certificate as entitled to such shares;
(B) with respect to uncertificated shares, an instruction is made by the registered owner of such uncertificated shares; or (C) with respect
to certificated shares or uncertificated shares, the endorsement or instruction is made by any other appropriate person or by an agent
who has actual authority to act on behalf of the appropriate person;
(iii)
the Corporation has received a guarantee of signature of the person signing such endorsement or instruction or such other reasonable assurance
that the endorsement or instruction is genuine and authorized as the Corporation may request;
(iv)
the transfer does not violate any restriction on transfer imposed by the Corporation that is enforceable in accordance with Section
7.8(a); and
(v)
such other conditions for such transfer as shall be provided for under applicable law have been satisfied.
(b)
Whenever any transfer of shares shall be made for collateral security and not absolutely, the Corporation shall so record such fact in
the entry of transfer if, when the certificate for such shares is presented to the Corporation for transfer or, if such shares are uncertificated,
when the instruction for registration of transfer thereof is presented to the Corporation, both the transferor and transferee request
the Corporation to do so.
Section
7.7 Registered Stockholders. Before due presentment for registration of transfer of a certificate representing shares of the Corporation
or of an instruction requesting registration of transfer of uncertificated shares, the Corporation may treat the registered owner as the
person exclusively entitled to inspect for any proper purpose the stock ledger and the other books and records of the Corporation, vote
such shares, receive dividends or notifications with respect to such shares and otherwise exercise all the rights and powers of the owner
of such shares, except that a person who is the beneficial owner of such shares (if held in a voting trust or by a nominee on behalf of
such person) may, upon providing documentary evidence of beneficial ownership of such shares and satisfying such other conditions as are
provided under applicable law, may also so inspect the books and records of the Corporation.
Section
7.8 Effect of the Corporation’s Restriction on Transfer.
(a)
A written restriction on the transfer or registration of transfer of shares of the Corporation or on the amount of shares of the Corporation
that may be owned by any person or group of persons, if permitted by the DGCL and noted conspicuously on the certificate representing
such shares or, in the case of uncertificated shares, contained in a notice, offering circular or prospectus sent by the Corporation to
the registered owner of such shares within a reasonable time prior to or after the issuance or transfer of such shares, may be enforced
against the holder of such shares or any successor or transferee of the holder including an executor, administrator, trustee, guardian
or other fiduciary entrusted with like responsibility for the person or estate of the holder.
(b)
A restriction imposed by the Corporation on the transfer or the registration of shares of the Corporation or on the amount of shares of
the Corporation that may be owned by any person or group of persons, even if otherwise lawful, is ineffective against a person without
actual knowledge of such restriction unless: (i) the shares are certificated and such restriction is noted conspicuously on the certificate;
or (ii) the shares are uncertificated and such restriction was contained in a notice, offering circular or prospectus sent by the Corporation
to the registered owner of such shares prior to or within a reasonable time after the issuance or transfer of such shares.
Section
7.9 Regulations. The Board shall have power and authority to make such additional rules and regulations, subject to any applicable
requirement of law, as the Board may deem necessary and appropriate with respect to the issue, transfer or registration of transfer of
shares of stock or certificates representing shares. The Board may appoint one or more transfer agents or registrars and may require for
the validity thereof that certificates representing shares bear the signature of any transfer agent or registrar so appointed.
ARTICLE
VIII
INDEMNIFICATION
Section
8.1 Right to Indemnification. To the fullest extent permitted by applicable law, as the same exists or may hereafter be amended, the
Corporation shall indemnify and hold harmless each person who was or is made a party or is threatened to be made a party to or is otherwise
involved in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative
(hereinafter a “proceeding”), by reason of the fact that he or she is or was a director or officer of the Corporation
or, while a director or officer of the Corporation, is or was serving at the request of the Corporation as a director, officer, employee
or agent of another corporation or of a partnership, joint venture, trust, other enterprise or nonprofit entity, including service with
respect to an employee benefit plan (hereinafter an “Indemnitee”), whether the basis of such proceeding is alleged
action in an official capacity as a director, officer, employee or agent, or in any other capacity while serving as a director, officer,
employee or agent, against all liability and loss suffered and expenses (including, without limitation, attorneys’ fees, judgments,
fines, ERISA excise taxes and penalties and amounts paid in settlement) reasonably incurred by such Indemnitee in connection with such
proceeding; provided, however, that, except as provided in Section 8.3 with respect to proceedings
to enforce rights to indemnification, the Corporation shall indemnify an Indemnitee in connection with a proceeding (or part thereof)
initiated by such Indemnitee only if such proceeding (or part thereof) was authorized by the Board.
Section
8.2 Right to Advancement of Expenses. In addition to the right to indemnification conferred in Section 8.1, an Indemnitee
shall also have the right to be paid by the Corporation to the fullest extent not prohibited by applicable law the expenses (including,
without limitation, attorneys’ fees) incurred in defending or otherwise participating in any such proceeding in advance of its final
disposition (hereinafter an “advancement of expenses”); provided, however, that, if
the DGCL requires, an advancement of expenses incurred by an Indemnitee in his or her capacity as a director or officer of the Corporation
(and not in any other capacity in which service was or is rendered by such Indemnitee, including, without limitation, service to an employee
benefit plan) shall be made only upon the Corporation’s receipt of an undertaking (hereinafter an “undertaking”),
by or on behalf of such Indemnitee, to repay all amounts so advanced if it shall ultimately be determined that such Indemnitee is not
entitled to be indemnified under this Article VIII or otherwise.
Section
8.3 Right of Indemnitee to Bring Suit. If a claim under Section 8.1 or Section 8.2 is not paid in
full by the Corporation within 60 days after a written claim therefor has been received by the Corporation, except in the case of a claim
for an advancement of expenses, in which case the applicable period shall be 20 days, the Indemnitee may at any time thereafter bring
suit against the Corporation to recover the unpaid amount of the claim. If successful in whole or in part in any such suit, or in a suit
brought by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the Indemnitee shall also be
entitled to be paid the expense of prosecuting or defending such suit. In (a) any suit brought by the Indemnitee to enforce a right to
indemnification hereunder (but not in a suit brought by an Indemnitee to enforce a right to an advancement of expenses) it shall be a
defense that, and (b) in any suit brought by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking,
the Corporation shall be entitled to recover such expenses upon a final judicial decision from which there is no further right to appeal
(hereinafter a “final adjudication”) that, the Indemnitee has not met any applicable standard for indemnification
set forth in the DGCL. Neither the failure of the Corporation (including its directors who are not parties to such action, a committee
of such directors, independent legal counsel, or its stockholders) to have made a determination prior to the commencement of such suit
that indemnification of the Indemnitee is proper in the circumstances because the Indemnitee has met the applicable standard of conduct
set forth in the DGCL, nor an actual determination by the Corporation (including a determination by its directors who are not parties
to such action, a committee of such directors, independent legal counsel, or its stockholders) that the Indemnitee has not met such applicable
standard of conduct, shall create a presumption that the Indemnitee has not met the applicable standard of conduct or, in the case of
such a suit brought by the Indemnitee, shall be a defense to such suit. In any suit brought by the Indemnitee to enforce a right to indemnification
or to an advancement of expenses hereunder, or by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking,
the burden of proving that the Indemnitee is not entitled to be indemnified, or to such advancement of expenses, under this Article
VIII or otherwise shall be on the Corporation.
Section
8.4 Non-Exclusivity of Rights. The rights provided to any Indemnitee pursuant to this Article VIII shall not be exclusive
of any other right, which such Indemnitee may have or hereafter acquire under applicable law, the Certificate of Incorporation, these
Bylaws, an agreement, a vote of stockholders or disinterested directors, or otherwise.
Section
8.5 Insurance. The Corporation may maintain insurance, at its expense, to protect itself and/or any director, officer, employee or
agent of the Corporation or another corporation, partnership, joint venture, trust or other enterprise against any expense, liability
or loss, whether or not the Corporation would have the power to indemnify such person against such expense, liability or loss under the
DGCL.
Section
8.6 Indemnification of Other Persons. This Article VIII shall not limit the right of the Corporation to the extent
and in the manner authorized or permitted by law to indemnify and to advance expenses to persons other than Indemnitees. Without limiting
the foregoing, the Corporation may, to the extent authorized from time to time by the Board, grant rights to indemnification and to the
advancement of expenses to any employee or agent of the Corporation and to any other person who is or was serving at the request of the
Corporation as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust or other enterprise,
including service with respect to an employee benefit plan, to the fullest extent of the provisions of this Article VIII with
respect to the indemnification and advancement of expenses of Indemnitees under this Article VIII.
Section
8.7 Amendments. Any repeal or amendment of this Article VIII by the Board or the stockholders of the Corporation
or by changes in applicable law, or the adoption of any other provision of these Bylaws inconsistent with this Article VIII,
will, to the extent permitted by applicable law, be prospective only (except to the extent such amendment or change in applicable law
permits the Corporation to provide broader indemnification rights to Indemnitees on a retroactive basis than permitted prior thereto),
and will not in any way diminish or adversely affect any right or protection existing hereunder in respect of any act or omission occurring
prior to such repeal or amendment or adoption of such inconsistent provision; provided, however, that amendments
or repeals of this Article VIII shall require the affirmative vote of the stockholders holding at least 66.7% of the
voting power of all outstanding shares of capital stock of the Corporation.
Section
8.8 Certain Definitions. For purposes of this Article VIII, (a) references to “other enterprise”
shall include any employee benefit plan; (b) references to “fines” shall include any excise taxes assessed on
a person with respect to an employee benefit plan; (c) references to “serving at the request of the Corporation”
shall include any service that imposes duties on, or involves services by, a person with respect to any employee benefit plan, its participants,
or beneficiaries; and (d) 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 interest
of the Corporation” for purposes of Section 145 of the DGCL.
Section
8.9 Contract Rights. The rights provided to Indemnitees pursuant to this Article VIII shall be contract rights and
such rights shall continue as to an Indemnitee who has ceased to be a director, officer, agent or employee and shall inure to the benefit
of the Indemnitee’s heirs, executors and administrators.
Section
8.10 Severability. If any provision or provisions of this Article VIII shall be held to be invalid, illegal or unenforceable
for any reason whatsoever: (a) the validity, legality and enforceability of the remaining provisions of this Article VIII shall
not in any way be affected or impaired thereby; and (b) to the fullest extent possible, the provisions of this Article VIII (including,
without limitation, each such portion of this Article VIII containing any such provision held to be invalid, illegal
or unenforceable) shall be construed so as to give effect to the intent manifested by the provision held invalid, illegal or unenforceable.
ARTICLE
IX
MISCELLANEOUS
Section
9.1 Place of Meetings. If the place of any meeting of stockholders, the Board or committee of the Board for which notice is required
under these Bylaws is not designated in the notice of such meeting, such meeting shall be held at the principal business office of the
Corporation; provided, however, if the Board has, in its sole discretion, determined that a meeting shall not
be held at any place, but instead shall be held by means of remote communication pursuant to Section 9.5 hereof, then
such meeting shall not be held at any place.
Section
9.2 Fixing Record Dates.
(a)
In order that the Corporation may determine the stockholders entitled to notice of any meeting of stockholders or any adjournment thereof,
the Board may fix a record date, which shall not precede the date upon which the resolution fixing the record date is adopted by the Board,
and which record date shall not be more than 60 nor less than 10 days before the date of such meeting. If the Board so fixes a date, such
date shall also be the record date for determining the stockholders entitled to vote at such meeting unless the Board determines, at the
time it fixes such record date, that a later date on or before the date of the meeting shall be the date for making such determination.
If no record date is fixed by the Board, the record date for determining stockholders entitled to notice of and to vote at a meeting of
stockholders shall be at the close of business on the business day next preceding the day on which notice is given, or, if notice is waived,
at the close of business on the business day next preceding the day on which the meeting is held. A determination of stockholders of record
entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however,
that the Board may fix a new record date for the adjourned meeting, and in such case shall also fix as the record date for stockholders
entitled to notice of such adjourned meeting the same or an earlier date as that fixed for determination of stockholders entitled to vote
in accordance with the foregoing provisions of this Section 9.2(a) at the adjourned meeting.
(b)
In order that the Corporation may determine the stockholders entitled to receive payment of any dividend or other distribution or allotment
of any rights or the stockholders entitled to exercise any rights in respect of any change, conversion or exchange of stock, or for the
purpose of any other lawful action, the Board may fix a record date, which record date shall not precede the date upon which the resolution
fixing the record date is adopted, and which record date shall be not more than 60 days prior to such action. If no record date is fixed,
the record date for determining stockholders for any such purpose shall be at the close of business on the day on which the Board adopts
the resolution relating thereto.
Section
9.3 Notice.
(a) Notice
to Directors. Whenever under applicable law, the Certificate of Incorporation or these Bylaws notice is required to be given to any
director, such notice shall be given either (i) in writing and sent by mail, or by a nationally recognized delivery service, (ii) by means
of facsimile telecommunication or other form of electronic transmission, or (iii) by oral notice given personally or by telephone. A notice
to a director will be deemed given as follows: (i) if given by hand delivery, orally, or by telephone, when actually received by the director,
(ii) if sent through the United States mail, when deposited in the United States mail, with postage and fees thereon prepaid, addressed
to the director at the director’s address appearing on the records of the Corporation, (iii) if sent for next day delivery by a
nationally recognized overnight delivery service, when deposited with such service, with fees thereon prepaid, addressed to the director
at the director’s address appearing on the records of the Corporation, (iv) if sent by facsimile telecommunication, when sent
to the facsimile transmission number for such director appearing on the records of the Corporation, (v) if sent by electronic mail, when
sent to the electronic mail address for such director appearing on the records of the Corporation, or (vi) if sent by any other form of
electronic transmission, when sent to the address, location or number (as applicable) for such director appearing on the records of the
Corporation.
(b) Notice
to Stockholders. Whenever under applicable law, the Certificate of Incorporation or these Bylaws notice is required to be given to
any stockholder, such notice may be given (i) in writing and sent either by hand delivery, through the United States mail, or by a nationally
recognized overnight delivery service for next day delivery, or (ii) by means of a form of electronic transmission consented to by
the stockholder, to the extent permitted by, and subject to the conditions set forth in Section 232 of the DGCL. A notice to a stockholder
shall be deemed given as follows: (i) if given by hand delivery, when actually received by the stockholder, (ii) if sent through the United
States mail, when deposited in the United States mail, with postage and fees thereon prepaid, addressed to the stockholder at the stockholder’s
address appearing on the stock ledger of the Corporation, (iii) if sent for next day delivery by a nationally recognized overnight delivery
service, when deposited with such service, with fees thereon prepaid, addressed to the stockholder at the stockholder’s address
appearing on the stock ledger of the Corporation, and (iv) if given by a form of electronic transmission consented to by the stockholder
to whom the notice is given and otherwise meeting the requirements set forth above, (A) if by facsimile transmission, when directed to
a number at which the stockholder has consented to receive notice, (B) if by electronic mail, when directed to an electronic mail address
at which the stockholder has consented to receive notice, (C) if by a posting on an electronic network together with separate notice to
the stockholder of such specified posting, upon the later of (1) such posting and (2) the giving of such separate notice, and (D) if by
any other form of electronic transmission, when directed to the stockholder. A stockholder may revoke such stockholder’s consent
to receiving notice by means of electronic communication by giving written notice of such revocation to the Corporation. Any such consent
shall be deemed revoked if (1) the Corporation is unable to deliver by electronic transmission two consecutive notices given by the Corporation
in accordance with such consent and (2) such inability becomes known to the Secretary or an Assistant Secretary or to the Corporation’s
transfer agent, or other person responsible for the giving of notice; provided, however, the inadvertent failure
to treat such inability as a revocation shall not invalidate any meeting or other action.
(c) Electronic
Transmission. “Electronic transmission” means any form of communication, not directly involving the physical
transmission of paper, that creates a record that may be retained, retrieved and reviewed by a recipient thereof, and that may be directly
reproduced in paper form by such a recipient through an automated process, including but not limited to transmission by telex, facsimile
telecommunication, electronic mail, telegram and cablegram.
(d) Notice
to Stockholders Sharing Same Address. Without limiting the manner by which notice otherwise may be given effectively by the Corporation
to stockholders, any notice to stockholders given by the Corporation under any provision of the DGCL, the Certificate of Incorporation
or these Bylaws shall be effective if given by a single written notice to stockholders who share an address if consented to by the stockholders
at that address to whom such notice is given. A stockholder may revoke such stockholder’s consent by delivering written notice of
such revocation to the Corporation. Any stockholder who fails to object in writing to the Corporation within 60 days of having been given
written notice by the Corporation of its intention to send such a single written notice shall be deemed to have consented to receiving
such single written notice.
(e) Exceptions
to Notice Requirements. Whenever notice is required to be given, under the DGCL, the Certificate of Incorporation or these Bylaws,
to any person with whom communication is unlawful, the giving of such notice to such person shall not be required and there shall be no
duty to apply to any governmental authority or agency for a license or permit to give such notice to such person. Any action or meeting
that shall be taken or held without notice to any such person with whom communication is unlawful shall have the same force and effect
as if such notice had been duly given. In the event that the action taken by the Corporation is such as to require the filing of a certificate
with the Secretary of State of Delaware, the certificate shall state, if such is the fact and if notice is required, that notice was given
to all persons entitled to receive notice except such persons with whom communication is unlawful.
Whenever
notice is required to be given by the Corporation, under any provision of the DGCL, the Certificate of Incorporation or these Bylaws,
to any stockholder to whom (1) notice of two consecutive annual meetings of stockholders and all notices of stockholder meetings or of
the taking of action by written consent of stockholders without a meeting to such stockholder during the period between such two consecutive
annual meetings, or (2) all, and at least two payments (if sent by first-class mail) of dividends or interest on securities during a 12-month
period, have been mailed addressed to such stockholder at such stockholder’s address as shown on the records of the Corporation
and have been returned undeliverable, the giving of such notice to such stockholder shall not be required. Any action or meeting that
shall be taken or held without notice to such stockholder shall have the same force and effect as if such notice had been duly given.
If any such stockholder shall deliver to the Corporation a written notice setting forth such stockholder’s then current address,
the requirement that notice be given to such stockholder shall be reinstated. In the event that the action taken by the Corporation is
such as to require the filing of a certificate with the Secretary of State of Delaware, the certificate need not state that notice was
not given to persons to whom notice was not required to be given pursuant to Section 230(b) of the DGCL. The exception in subsection (1)
of the first sentence of this paragraph to the requirement that notice be given shall not be applicable to any notice returned as undeliverable
if the notice was given by electronic transmission.
Section
9.4 Waiver of Notice. Whenever any notice is required to be given under applicable law, the Certificate of Incorporation, or these
Bylaws, a written waiver of such notice, signed before or after the date of such meeting by the person or persons entitled to said notice,
or a waiver by electronic transmission by the person entitled to said notice, shall be deemed equivalent to such required notice. All
such waivers shall be kept with the books of the Corporation. Attendance at a meeting shall constitute a waiver of notice of such meeting,
except where a person attends for the express purpose of objecting to the transaction of any business on the ground that the meeting was
not lawfully called or convened.
Section
9.5 Meeting Attendance via Remote Communication Equipment.
(a) Stockholder
Meetings. If authorized by the Board in its sole discretion, and subject to such guidelines and procedures as the Board may adopt,
stockholders entitled to vote at such meeting and proxy holders not physically present at a meeting of stockholders may, by means of remote
communication:
(i)
participate in a meeting of stockholders; and
(ii)
be deemed present in person and vote at a meeting of stockholders, whether such meeting is to be held at a designated place or solely
by means of remote communication; provided, that (A) the Corporation shall implement reasonable measures to verify that each
person deemed present and permitted to vote at the meeting by means of remote communication is a stockholder or proxy holder, (B) the
Corporation shall implement reasonable measures to provide such stockholders and proxy holders a reasonable opportunity to participate
in the meeting and, if entitled to vote, to vote on matters submitted to the applicable stockholders, including an opportunity to read
or hear the proceedings of the meeting substantially concurrently with such proceedings, and (C) if any stockholder or proxy holder votes
or takes other action at the meeting by means of remote communication, a record of such votes or other action shall be maintained by the
Corporation.
(b) Board
Meetings. Unless otherwise restricted by applicable law, the Certificate of Incorporation or these Bylaws, members of the Board or
any committee thereof may participate in a meeting of the Board or any committee thereof by means of conference telephone or other communications
equipment by means of which all persons participating in the meeting can hear each other. Such participation in a meeting shall constitute
presence in person at the meeting, except where a person participates in the meeting for the express purpose of objecting to the transaction
of any business on the ground that the meeting was not lawfully called or convened.
Section
9.6 Dividends. The Board may from time to time declare, and the Corporation may pay, dividends (payable in cash, property or shares
of the Corporation’s capital stock) on the Corporation’s outstanding shares of capital stock, subject to applicable law and
the Certificate of Incorporation.
Section
9.7 Reserves. The Board may set apart out of the funds of the Corporation available for dividends a reserve or reserves for any proper
purpose and may abolish any such reserve.
Section
9.8 Contracts and Negotiable Instruments. Except as otherwise provided by applicable law, the Certificate of Incorporation or these
Bylaws, any contract, bond, deed, lease, mortgage or other instrument may be executed and delivered in the name and on behalf of the Corporation
by such officer or officers or other employee or employees of the Corporation as the Board may from time to time authorize. Such authority
may be general or confined to specific instances as the Board may determine. The Chairman of the Board, the Chief Executive Officer, the
President, the Chief Financial Officer, the Treasurer or any Vice President may execute and deliver any contract, bond, deed, lease, mortgage
or other instrument in the name and on behalf of the Corporation. Subject to any restrictions imposed by the Board, the Chairman of the
Board Chief Executive Officer, President, the Chief Financial Officer, the Treasurer or any Vice President may delegate powers to execute
and deliver any contract, bond, deed, lease, mortgage or other instrument in the name and on behalf of the Corporation to other officers
or employees of the Corporation under such person’s supervision and authority, it being understood, however, that any such delegation
of power shall not relieve such officer of responsibility with respect to the exercise of such delegated power.
Section
9.9 Fiscal Year. The fiscal year of the Corporation shall be fixed by the Board.
Section
9.10 Seal. The Board may adopt a corporate seal, which shall be in such form as the Board determines. The seal may be used by causing
it or a facsimile thereof to be impressed, affixed or otherwise reproduced.
Section
9.11 Books and Records. The books and records of the Corporation may be kept within or outside the State of Delaware at such place
or places as may from time to time be designated by the Board.
Section
9.12 Resignation. Any director, committee member or officer may resign by giving notice thereof in writing or by electronic transmission
to the Chairman of the Board, the Chief Executive Officer, the President or the Secretary. The resignation shall take effect at the time
specified therein, or at the time of receipt of such notice if no time is specified or the specified time is earlier than the time of
such receipt. Unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective.
Section
9.13 Surety Bonds. Such officers, employees and agents of the Corporation (if any) as the Chairman of the Board, Chief Executive Officer,
President or the Board may direct, from time to time, shall be bonded for the faithful performance of their duties and for the restoration
to the Corporation, in case of their death, resignation, retirement, disqualification or removal from office, of all books, papers, vouchers,
money and other property of whatever kind in their possession or under their control belonging to the Corporation, in such amounts and
by such surety companies as the Chairman of the Board, Chief Executive Officer, President or the Board may determine. The premiums on
such bonds shall be paid by the Corporation and the bonds so furnished shall be in the custody of the Secretary.
Section
9.14 Securities of Other Corporations. Powers of attorney, proxies, waivers of notice of meeting, consents in writing and other instruments
relating to securities owned by the Corporation may be executed in the name of and on behalf of the Corporation by the Chairman of the
Board, Chief Executive Officer, President, any Vice President or any officers authorized by the Board. Any such officer, may, in the name
of and on behalf of the Corporation, take all such action as any such officer may deem advisable to vote in person or by proxy at any
meeting of security holders of any corporation in which the Corporation may own securities, or to consent in writing, in the name of the
Corporation as such holder, to any action by such corporation, and at any such meeting or with respect to any such consent shall possess
and may exercise any and all rights and power incident to the ownership of such securities and which, as the owner thereof, the Corporation
might have exercised and possessed. The Board may from time to time confer like powers upon any other person or persons.
Section
9.15 Amendments. In furtherance and not in limitation of the powers conferred upon it by law, the Board is expressly authorized to
adopt, amend, alter or repeal the Bylaws. The Bylaws also may be adopted, amended, altered or repealed by the stockholders of the Corporation; provided, however,
that in addition to any vote of the holders of any class or series of capital stock of the Corporation required by law or by the Certificate
of Incorporation, the affirmative vote of the holders of at least a majority of the voting power of all then outstanding shares of capital
stock of the Corporation entitled to vote generally in the election of directors, voting together as a single class, shall be required
for the stockholders of the Corporation to adopt, amend, alter or repeal the Bylaws; and provided, further, however,
that no Bylaws hereafter adopted by the stockholders of the Corporation shall invalidate any prior act of the Board that would have been
valid if such Bylaws had not been adopted.
Exhibit I
FORM OF
VOTING AGREEMENT
This
Voting Agreement (this “Agreement”) is made as of [__], 2022, by and among DataLogiq, Inc. (f/k/a Abri SPAC
I, Inc.), a Delaware corporation (the “Parent”), Abri Ventures I, LLC (the “Sponsor”),
and each of the individuals and entities set forth on the signature page hereto (each a “Voting Party” and collectively,
the “Voting Parties”). For purposes of this Agreement, capitalized terms used and not defined herein shall have
the respective meanings ascribed to them in the Merger Agreement (as defined below). This Agreement shall be effective as of the Closing
Date of the Merger.
RECITALS
WHEREAS,
Parent, Abri Merger Sub, Inc., a Delaware corporation, DLQ, Inc., a Nevada corporation (the “Company”), and
Logiq, Inc., the parent of DLQ, Inc. have entered into that certain Merger Agreement (as may be amended from time to time, the “Merger
Agreement”), dated as of September 9, 2022;
WHEREAS,
each of the Voting Parties, currently owns, or on the closing of the transactions contemplated by the Merger Agreement, will own, shares
of Parent’s common stock, and wishes to provide for orderly elections of Parent’s Board of Directors after the Closing Date
(the “Post-Closing Board of Directors”) as described herein; and
WHEREAS,
as of the Effective Time, three directors, each designated by Sponsor, have been elected to the Post-Closing Board of Directors.
NOW
THEREFORE, in consideration of the foregoing and of the promises and covenants contained herein, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:
AGREEMENT
1.
Agreement to Vote. During the term of this Agreement, each Voting Party agrees to vote all shares of capital stock of Parent that
such Voting Party owns from time to time and are entitled to vote (hereinafter referred to as the “Voting Shares”)
in the election of the Post-Closing Board of Directors, in accordance with the provisions of this Agreement, whether at a regular or special
meeting of stockholders or by written consent.
2.
Election of Boards of Directors.
2.1
Voting; Initial Designees. During the term of this Agreement, each Voting Party agrees to vote all Voting Shares for the election
as members of the Post-Closing Board of Directors of each nominee designated by the Sponsor at each regular or special meeting of Parent
stockholders where such nominee stands for such election at such meeting. The Sponsor’s initial designees to the Post-Closing Board
of Directors are [________][ ], and [________].
2.2
Size of the Board. During the term of this Agreement, the parties hereto agree that they shall, and shall cause their respective successors
to, maintain the size of the Post-Closing Board of Directors at five (5) directors.
2.3
Number of Designees; Notice to Parent.
(a)
Prior to the termination of this Agreement, for so long as the Sponsor and/or its Affiliates, either individually or as a group (as such
term is construed in accordance with the Exchange Act), beneficially own at least fifty percent (50%) of the Closing Sponsor Shares (as
defined below), Parent shall include in the slate of nominees recommended by the Post-Closing Board of Directors for election as directors
at each applicable annual or special meeting of the stockholders of Parent at which directors are to be elected, each of the three (3)
individuals designated by the Sponsor; provided, however, that:
(i)
from and after the date on which Sponsor and/or its Affiliates cease to hold at least fifty percent (50%) of the Closing Sponsor Shares
(a “50% Reduction”), the number of nominees designated by Sponsor that Parent is required to recommend for election
at any subsequent annual or special meeting of the stockholders of Parent at which directors are to be elected pursuant to this Section
2.3(a) shall be reduced to two (2); and
(ii)
from and after the date on which Sponsor and/or its Affiliates cease to hold at least twenty-five percent (25%) of the Closing Sponsor
Shares (a “75% Reduction”), Parent shall have no obligation to recommend any nominees designated by Sponsor
for election at any subsequent annual or special meeting of the stockholders of Parent at which directors are to be elected.
(b)
No less than five (5) Business Days following the Closing, Sponsor shall provide written notice to Parent specifying the number of shares
of capital stock of Parent held by Sponsor and/or its Affiliates individually or as a group (as such term is construed in accordance with
the Exchange Act) as of the Effective Time, including any shares of capital stock of Parent that Sponsor and/or its Affiliates are entitled
to receive as Merger Consideration in connection with the consummation of the Merger (the “Closing Sponsor Shares”).
(c)
No less than five (5) Business Days after the occurrence of a 50% Reduction and a 75% Reduction, as applicable, Sponsor shall provide
written notice thereof to Parent, which notice shall set forth, if delivered solely with respect to a 50% Reduction, the name of the Sponsor
Designee (as defined below) to be removed from the Post-Closing Board of Directors pursuant to Section 2.5(a).
2.4
Advance Resignation Letters. Parent may require, prior to or at any time after becoming a member of the Post-Closing Board of Directors,
each designee of Sponsor elected to the Post-Closing Board of Directors (each, as may be replaced from time to time, a “Sponsor
Designee”) to execute and deliver an undated resignation letter (each, a “Resignation Letter”)
to the Secretary of Parent, which Parent agrees shall not be dated or become effective until such time as such Sponsor Designee’s
resignation is required pursuant to Section 2.5(a).
2.5
Removal of Directors; Obligations; Vacancies.
(a)
Sponsor hereby acknowledges and agrees that, upon the occurrence of: (i) a 50% Reduction, Parent may effect the resignation of the Sponsor
Designee specified in the notice given by Sponsor pursuant to Section 2.3(c); (ii) a 75% Reduction, Parent may effect the resignation
of the final Sponsor Designee; and (iii) both a 50% Reduction and a 75% Reduction, simultaneously, Parent may effect the resignation of
both Sponsor Designees, in each case pursuant to the dating of the applicable Resignation Letter of such Sponsor Designee as of the date
of the 50% Reduction or the 75% Reduction, as applicable, with such resignation deemed to have occurred, and being effective as of, such
date. In the event Sponsor does not deliver the notice required pursuant to Section 2.3(b) by the date that is five (5) Business Days
after the occurrence of a 50% Reduction or a 75% Reduction, as applicable, Parent has the right, upon otherwise becoming aware of the
occurrence of a 50% Reduction or a 75% Reduction, to take the actions specified in the immediately preceding sentence and, in the case
of a 50% Reduction only, may effect the resignation of a Sponsor Designee determined by Parent in its sole discretion.
(b)
The obligations of the Voting Parties pursuant to this Section 2 shall include any stockholder vote to amend Parent’s amended and
restated certificate of incorporation as required to effect the intent of this Agreement. Each of Sponsor, the Voting Parties and Parent
agree to take all actions required to ensure that the rights given to each Voting Party and Sponsor hereunder are effective and that each
Voting Party and Sponsor enjoys the benefits thereof. Each of Sponsor, the Voting Parties and Parent further agree not to take any actions
that would contravene or materially and adversely affect the provisions of this Agreement and the intention of the parties with respect
to the composition of the Post-Closing Board of Directors as herein stated. The parties acknowledge that the fiduciary duties of each
member of the Post-Closing Board of Directors are to Parent’s stockholders as a whole.
(c)
In the event any director elected pursuant to the terms hereof ceases to serve as a member of the Post-Closing Board of Directors, except
for as the result of any 50% Reduction or 75% Reduction, Parent, the Sponsor and the Voting Parties agree to vote the Voting Shares for
the election or appointment of such other person designated by the Sponsor to the Post-Closing Board of Directors in accordance with the
terms provided herein (each such Person, a “Replacement Designee”); provided, however, that
any Replacement Designee must (i) be reasonably acceptable to the Post-Closing Board of Directors (such acceptance not to be unreasonably
withheld), (ii) qualify as “independent” pursuant to NASDAQ listing standards, (iii) have the relevant financial and business
experience to be a director of Parent, and (iv) satisfy the publicly disclosed guidelines and policies of Parent with respect to service
on the Post-Closing Board of Directors. In the event any Replacement Designee does not satisfy one or more of the requirements set forth
in clauses (i) through (iv) above, Sponsor shall have the right to recommend additional Replacement Designees whose appointment shall
be subject to approval in accordance with the procedures described in this Section 2.5(c).
3.
Representations and Warranties of the Sponsor and the Voting Parties. Each Voting Party and the Sponsor hereby represents and warrants
to Parent as follows:
3.1 Organization
and Power. Such Person is duly organized, validly existing, and in good standing under the laws of the jurisdiction of its formation
and has all requisite power and authority to carry on its business as presently conducted and as proposed to be conducted.
3.2 Authorization.
Such Person has full power and authority to enter into this Agreement. This Agreement, when executed and delivered by such Person, shall
constitute the valid and legally binding obligation of such Person, enforceable in accordance with its terms, except: (i) as limited
by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance and any other laws of general application affecting
enforcement of creditors’ rights generally; or (ii) as limited by laws relating to the availability of specific performance, injunctive
relief or other equitable remedies.
3.3 Governmental
Consents and Filings. No consent, approval, order or authorization of, or registration, qualification, designation, declaration or
filing with, any federal, state or local governmental authority is required on the part of such Person in connection with the consummation
of the transactions contemplated by this Agreement.
3.4 Compliance
with Other Instruments. The execution, delivery and performance by such Person of this Agreement and the consummation by such Person
of the transactions contemplated by this Agreement will not result in any violation or default: (a) of any provisions of its organizational
documents, if applicable; (b) of any instrument, judgment, order, writ or decree to which it is a party or by which it is bound; (c) under
any note, indenture or mortgage to which it is a party or by which it is bound; (d) under any lease, agreement, contract or purchase order
to which it is a party or by which it is bound; or (e) of any provision of any federal or state statute, rule or regulation applicable
to such Person, in each case (other than clause (a)), which would have a material adverse effect on such Person or its ability to consummate
the transactions contemplated by this Agreement.
4. Successors
in Interest of the Voting Parties and Parent. The provisions of this Agreement shall be binding upon the successors in interest of
any Voting Party with respect to any of such Voting Party’s Voting Shares or any voting rights therein, unless (i) the Voting Shares
are sold on Nasdaq or any other national securities exchange or (ii) with respect to Logiq, Inc., such Voting Shares are the Dividend
Shares. Each Voting Party shall not, and Parent shall not, permit the transfer of any Voting Party’s Voting Shares (except for sales
of Voting Shares on Nasdaq or any other national securities exchange), unless and until the person to whom such securities are to be transferred
shall have executed a written agreement pursuant to which such person agrees to become a party to this Agreement and agrees to be bound
by all the provisions hereof as if such person was a Voting Party hereunder. Notwithstanding the foregoing, the Parties hereto agree and
acknowledge that each of the Voting Parties has entered into a Company Lock-Up Agreement and has agreed not to transfer any of the Voting
Party’s Voting Shares except in accordance with the Company Lock-Up Agreement.
5.
Public Listing. During the term of this Agreement, Parent shall take all reasonable efforts for Parent to remain listed as a public
company on, and for the common stock of Parent to be tradable over, Nasdaq.
6.
Grant of Proxy. The parties agree that this Agreement does not constitute the granting of a proxy to any party or any other person; provided, however,
that should the provisions of this Agreement be construed to constitute the granting of proxies, such proxies shall be deemed coupled
with an interest and are irrevocable for the term of this Agreement.
7.
Specific Enforcement. It is agreed and understood that monetary damages would not adequately compensate an injured party for the breach
of this Agreement by any party hereto, that this Agreement shall be specifically enforceable, and that any breach of this Agreement shall
be the proper subject of a temporary or permanent injunction or restraining order. Further, each party hereto waives any claim or defense
that there is an adequate remedy at Law for such breach or threatened breach and agrees that a party’s rights would be materially
and adversely affected if the obligations of the other parties under this Agreement were not carried out in accordance with the terms
and conditions hereof.
8.
Manner of Voting. The voting of the Voting Shares pursuant to this Agreement may be effected in person, by proxy, by written consent
or in any other manner permitted by applicable Law.
9.
Termination. This Agreement shall terminate automatically (without any action by any party) upon the earlier to occur of (a) the date
that is the second (2nd) anniversary of the date hereof and (b) the occurrence of a 75% Reduction, and thereafter shall immediately
become void and have no further force or effect, and no party hereto will have any further obligation or liability to any other party; provided, however,
that no such termination will relieve either party from liability for any breach of this Agreement by such party prior to such termination.
10.
Amendments and Waivers. Except as otherwise provided herein, any provision of this Agreement may be amended or the observance thereof
may be waived (either generally or in a particular instance and either retroactively or prospectively) only with the unanimous written
consent of (a) Parent, and (b) the holders of a majority of Voting Shares then held by the Voting Parties.
11.
Stock Splits, Stock Dividends, etc. In the event of any stock split, stock dividend, recapitalization, reorganization or the like,
(a) any securities issued with respect to Voting Shares held by Voting Parties shall become Voting Shares for purposes of this Agreement
and (b) the Closing Sponsor Shares shall be appropriately adjusted on a pro rata basis and consistent with the terms of this Agreement.
12.
Severability. A determination by a court or other legal authority that any provision that is not of the essence of this Agreement
is legally invalid shall not affect the validity or enforceability of any other provision hereof. The parties shall cooperate in good
faith to substitute (or cause such court or other legal authority to substitute) for any provision so held to be invalid a valid provision,
as alike in substance to such invalid provision as is lawful.
13.
Governing Law. This Agreement and all disputes or controversies arising out of or relating to this Agreement, including the applicable
statute of limitations, shall be governed by and interpreted in accordance with the Laws of the State of Delaware, without giving effect
to any choice of law or conflict of law provision or rule (whether of the State of Delaware or any other jurisdiction) that would cause
the application of the Law of any jurisdiction other than the State of Delaware.
14.
Counterparts; Electronic Signatures. This Agreement may be executed in counterparts, each of which shall constitute an original, but
all of which shall constitute one agreement. This Agreement shall become effective upon delivery to each party of an executed counterpart
or the earlier delivery to each party of original, photocopied, or electronically transmitted signature pages that together (but need
not individually) bear the signatures of all other parties.
15.
Successors and Assigns. Except as otherwise expressly provided in this Agreement, the provisions hereof shall inure to the benefit
of, and be binding upon, the successors and assigns of the parties hereto.
16.
Entire Agreement. This Agreement constitutes the full and entire understanding and agreement among the parties, and supersedes any
prior agreement or understanding among the parties, with regard to the subjects hereof and thereof, and no party shall be liable or bound
to any other party in any manner by any warranties, representations or covenants except as specifically set forth herein or therein.
[Remainder of page
intentionally left blank; signature page follows]
This Agreement is hereby
executed effective as of the date first set forth above.
| |
Parent: |
| |
|
| |
DATALOGIQ, INC. |
| |
|
| |
By: |
|
|
| |
Name: |
|
|
| |
Title: |
|
|
| |
|
|
|
| |
Sponsor: |
| |
|
| |
ABRI VENTURES I, LLC |
| |
|
| |
By: |
|
|
| |
Name: |
|
|
| |
Title: |
|
|
| |
|
|
|
| |
Voting Parties: |
| |
|
| |
[To be provided.] |
[Signature Page to Voting
Agreement]
Annex B-1
Charter Amendment
SECOND AMENDMENT TO
THE
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION OF
ABRI SPAC I, INC.
[*], 2023
Abri
SPAC I, Inc., a corporation organized and existing under the laws of the State of Delaware (the “Corporation”),
DOES HEREBY CERTIFY AS FOLLOWS:
1. The
name of the Corporation is “Abri SPAC I, Inc.” The original certificate of incorporation of the Corporation was filed
with the Secretary of State of the State of Delaware on March 18, 2021. The Amended and Restated Certificate of Incorporation of
the Corporation was filed with the Secretary of State of Delaware on August 9, 2021 (the “Amended and Restated Certificate”).
An Amendment to the Amended and Restated Certificate was made on December 9, 2022.
2. This
Second Amendment to the Amended and Restated Certificate amends the Amended and Restated Certificate.
3. This
Second Amendment to the Amended and Restated Certificate was duly adopted by the Board of Directors of the Corporation and the stockholders
of the Corporation in accordance with Section 242 of the General Corporation Law of the State of Delaware.
4. The
text of paragraph (a) of Section 9.2 Redemption Rights — Article NINTH, is hereby amended and
restated to read in full as follows:
“(a) Prior
to the consummation of the initial Business Combination, the Corporation shall provide all holders of Offering Shares with the opportunity
to have their Offering Shares redeemed upon the consummation of the initial Business Combination pursuant to, and subject to the limitations
of, Sections 9.2(b) and 9.2(c) (such rights of such holders to have their Offering Shares redeemed pursuant to such Sections,
the “Redemption Rights”) hereof for cash equal to the applicable redemption price per share determined in accordance with
Section 9.2(b) hereof (the “Redemption Price”). Notwithstanding anything to the contrary contained in this Amended
and Restated Certificate, there shall be no Redemption Rights or liquidating distributions with respect to any warrant issued pursuant
to the Offering.”
IN
WITNESS WHEREOF, Abri SPAC I, Inc. has caused this Amendment to the Amended and Restated Certificate to be duly executed in its name
and on its behalf by an authorized officer as of the date first set above.
ABRI SPAC I, INC.
| By: |
|
|
|
|
| |
|
|
|
|
| Name: |
|
Jeffrey Tirman |
|
|
| |
|
|
|
|
| Title: |
|
Chief Executive Officer |
|
|
Annex B-2
FORM OF
SECOND AMENDED AND
RESTATED
CERTIFICATE OF INCORPORATION
OF
ABRI SPAC I, INC.
[•]
Abri
SPAC I, Inc., a corporation organized and existing under the laws of the State of Delaware (the “Corporation”),
DOES HEREBY CERTIFY AS FOLLOWS:
1.
The name of the Corporation is “Abri SPAC I, Inc.” The original certificate of incorporation of the Corporation
was filed with the Secretary of State of the State of Delaware on March 18, 2021 (the “Original Certificate”).
2.
The Amended and Restated Certificate of Incorporation was filed with the Delaware Secretary of State on August 9, 2021 (the “First
A&R Certificate”).
3.
This Second Amended and Restated Certificate of Incorporation (this “Second Amended and Restated Certificate”),
which restates and amends the provisions of the First A&R Certificate, was duly adopted in accordance with Sections 242 and 245 of
the General Corporation Law of the State of Delaware, as amended from time to time (the “DGCL”).
4.
This Second Amended and Restated Certificate shall become effective on the date of filing with the Secretary of State of Delaware.
5.
The text of the First A&R Certificate is hereby restated and amended in its entirety to read as follows:
ARTICLE
I
NAME
The
name of the corporation is DataLogiq, Inc. (the “Corporation”).
ARTICLE
II
PURPOSE
The
purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the DGCL.
ARTICLE
III
REGISTERED AGENT
The
address of the Corporation’s registered office in the State of Delaware is 3411 Silverside Road, Tatnall Building #104, in the City
of Wilmington, County of New Castle, State of Delaware, 19810, and the name of the Corporation’s registered agent at such address
is Corporate Creations Network Inc.
ARTICLE
IV
CAPITALIZATION
Section
4.1 Authorized Capital Stock. The total number of shares of all classes of capital stock which the Corporation is authorized
to issue is 300,000,000 shares, consisting of (a) 200,000,000 shares of common stock, par value $0.0001 per share (the “Common
Stock”) and (b) 100,000,000 shares of preferred stock, par value $0.0001 per share (the “Preferred Stock”).
Section
4.2 Preferred Stock. Subject to Article IX of this Amended and Restated Certificate, the Board of Directors of the Corporation
(the “Board”) is hereby expressly authorized to provide out of the unissued shares of the Preferred Stock for
one or more series of Preferred Stock and to establish from time to time the number of shares to be included in each such series and to
fix the voting rights, if any, designations, powers, preferences and relative, participating, optional, special and other rights, if any,
of each such series and any qualifications, limitations and restrictions thereof, as shall be stated in the resolution or resolutions
adopted by the Board providing for the issuance of such series and included in a certificate of designation (a “Preferred Stock
Designation”) filed pursuant to the DGCL, and the Board is hereby expressly vested with the authority to the full extent provided
by law, now or hereafter, to adopt any such resolution or resolutions.
Section
4.3 Common Stock.
(a) Voting.
(i)
Except as otherwise required by law or this Second Amended and Restated Certificate, the holders of the shares of Common Stock shall exclusively
possess all voting power with respect to the Corporation.
(ii)
Except as otherwise required by law or this Second Amended and Restated Certificate, the holders of shares of Common Stock shall be entitled
to one vote for each such share on each matter properly submitted to the stockholders of the Corporation on which the holders of the shares
of Common Stock are entitled to vote.
(iii)
Except as otherwise required by law or this Second Amended and Restated Certificate (including any Preferred Stock Designation), at any
annual or special meeting of the stockholders of the Corporation, the holders of the shares of Common Stock and the holders of any outstanding
series of the Preferred Stock shall have the exclusive right to vote for the election of directors and on all other matters properly submitted
to a vote of the stockholders of the Corporation. Notwithstanding the foregoing, except as otherwise required by law or this Second Amended
and Restated Certificate, the holders of the shares of Common Stock shall not be entitled to vote on any amendment to this Second Amended
and Restated Certificate that relates solely to the terms of one or more outstanding series of Preferred Stock if the holders of such
affected series of Preferred Stock are entitled, either separately or together with the holders of one or more other such series, to vote
thereon pursuant to this Second Amended and Restated Certificate or the DGCL.
(b) Dividends.
Subject to applicable law and the rights, if any, of the holders of any outstanding series of the Preferred Stock, the holders of the
shares of Common Stock shall be entitled to receive such dividends and other distributions (payable in cash, property or capital stock
of the Corporation) when, as and if declared thereon by the Board from time to time out of any assets or funds of the Corporation legally
available therefor and shall share equally on a per share basis in such dividends and distributions.
(c) Liquidation,
Dissolution or Winding Up of the Corporation. Subject to applicable law, the rights, if any, of the holders of any outstanding
series of the Preferred Stock, in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Corporation,
after payment or provision for payment of the debts and other liabilities of the Corporation, the holders of the shares of Common Stock
shall be entitled to receive all the remaining assets of the Corporation available for distribution to its stockholders, ratably in proportion
to the number of shares of Common Stock held by them.
Section
4.4 Rights and Options. The Corporation has the authority to create and issue rights, warrants and options entitling
the holders thereof to acquire from the Corporation any shares of its capital stock of any class or classes, with such rights, warrants
and options to be evidenced by or in instrument(s) approved by the Board. The Board is empowered to set the exercise price, duration,
times for exercise and other terms and conditions of such rights, warrants or options; provided, however, that
the consideration to be received for any shares of capital stock issuable upon exercise thereof may not be less than the par value thereof.
ARTICLE
V
BOARD OF DIRECTORS
Section
5.1 Board Powers. The business and affairs of the Corporation shall be managed by, or under the direction of, the Board.
In addition to the powers and authority expressly conferred upon the Board by statute, this Second Amended and Restated Certificate or
the Bylaws of the Corporation (“Bylaws”), the Board is hereby empowered to exercise all such powers and do all
such acts and things as may be exercised or done by the Corporation, subject, nevertheless, to the provisions of the DGCL, this Second
Amended and Restated Certificate, and any Bylaws adopted by the stockholders of the Corporation; provided, however,
that no Bylaws hereafter adopted by the stockholders of the Corporation shall invalidate any prior act of the Board that would have been
valid if such Bylaws had not been adopted.
Section
5.2 Number, Election and Term.
(a)
The number of directors of the Corporation, other than those who may be elected by the holders of one or more series of the Preferred
Stock voting separately by class or series, shall be fixed from time to time exclusively by the Board pursuant to a resolution adopted
by the Board.
(b)
Each director of the Corporation shall serve for a term expiring at the next annual meeting of stockholders following such director’s
appointment or election and until such director’s successor is duly elected and qualified, or until such director’s earlier
death, resignation, disqualification or removal. Subject to the rights of the holders of one or more series of Preferred Stock, voting
separately by class or series, to elect directors pursuant to the terms of one or more series of Preferred Stock, the election of directors
shall be determined by a plurality of the votes cast by the stockholders present in person or represented by proxy at the meeting and
entitled to vote thereon.
(c)
No decrease in the number of directors constituting the Board of Directors shall shorten the term of any incumbent director.
(d)
Unless and except to the extent that the Bylaws shall so require, the election of directors need not be by written ballot. The holders
of shares of Common Stock shall not have cumulative voting rights with respect to any election of directors.
Section
5.3 Newly Created Directorships and Vacancies. Subject to Section 5.5 hereof, newly created directorships
resulting from an increase in the number of directors and any vacancies on the Board resulting from death, resignation, retirement, disqualification,
removal or other cause may be filled solely and exclusively by a majority vote of the remaining directors then in office, even if less
than a quorum, or by a sole remaining director (and not by stockholders), and any director so chosen shall hold office for the remainder
of the full term in which the vacancy occurred and until his or her successor has been elected and qualified, subject, however, to such
director’s earlier death, resignation, retirement, disqualification or removal.
Section
5.4 Removal. Subject to Section 5.5 hereof, any director may be removed from office without cause
but only by the affirmative vote of the holders of not less than a majority of the outstanding stock of the Corporation entitled to vote
generally in the election of directors, voting together as a single class.
Section
5.5 Preferred Stock — Directors. Notwithstanding any other provision of this Article V,
and except as otherwise required by law, whenever the holders of one or more series of the Preferred Stock shall have the right, voting
separately by class or series, to elect one or more directors, the term of office, the filling of vacancies, the removal from office and
other features of such directorships shall be governed by the terms of such series of the Preferred Stock as set forth in this Second
Amended and Restated Certificate (including any Preferred Stock Designation).
ARTICLE
VI
BYLAWS
In
furtherance and not in limitation of the powers conferred upon it by law, the Board is expressly authorized to adopt, amend, alter or
repeal the Bylaws. The Bylaws also may be adopted, amended, altered or repealed by the stockholders of the Corporation; provided, however,
that in addition to any vote of the holders of any class or series of capital stock of the Corporation required by law or by this Second
Amended and Restated Certificate, the affirmative vote of the holders of at least a majority of the voting power of all then outstanding
shares of capital stock of the Corporation entitled to vote generally in the election of directors, voting together as a single class,
shall be required for the stockholders of the Corporation to adopt, amend, alter or repeal the Bylaws; and provided, further,
however, that no Bylaws hereafter adopted by the stockholders of the Corporation shall invalidate any prior act of the Board that would
have been valid if such Bylaws had not been adopted.
ARTICLE
VII
SPECIAL MEETINGS OF STOCKHOLDERS; ACTION BY WRITTEN CONSENT
Section
7.1 Special Meetings. Subject to the rights, if any, of the holders of any outstanding series of the Preferred Stock,
and to the requirements of applicable law, special meetings of stockholders of the Corporation may be called only by the Chairman of the
Board, the Chief Executive Officer of the Corporation or the Board pursuant to a resolution adopted by the Board, and the ability of the
stockholders of the Corporation to call a special meeting is hereby specifically denied. Except as provided in the foregoing sentence,
special meetings of stockholders of the Corporation may not be called by any other person or persons.
Section
7.2 Advance Notice. Advance notice of stockholder nominations for the election of directors and of business to be
brought by stockholders before any meeting of the stockholders of the Corporation shall be given in the manner provided in the Bylaws.
Section
7.3 Action by Written Consent. Except as may be otherwise provided for or fixed pursuant to this Amended and Restated
Certificate (including any Preferred Stock Designation) relating to the rights of the holders of any outstanding series of Preferred Stock,
any action required or permitted to be taken by stockholders of the Corporation must be effected at a duly called annual or special meeting
of the stockholders and may not be effected by written consent in lieu of a meeting.
ARTICLE
VIII
LIMITED LIABILITY; INDEMNIFICATION
Section
8.1 Limitation of Director Liability. A director of the Corporation shall not be personally liable to the Corporation
or its stockholders for monetary damages for breach of fiduciary duty as a director, except to the extent such exemption from liability
or limitation thereof is not permitted under the DGCL as the same exists or may hereafter be amended unless a director violated his or
her duty of loyalty to the Corporation or its stockholders, acted in bad faith, knowingly or intentionally violated the law, authorized
unlawful payments of dividends, unlawful stock purchases or unlawful redemptions, or derived improper personal benefit from its actions
as a director. Any amendment, modification or repeal of the foregoing sentence shall not adversely affect any right or protection of a
director of the Corporation hereunder in respect of any act or omission occurring prior to the time of such amendment, modification or
repeal.
Section
8.2 Indemnification and Advancement of Expenses.
(a)
To the fullest extent permitted by applicable law, as the same exists or may hereafter be amended, the Corporation shall indemnify and
hold harmless each person who is or was made a party or is threatened to be made a party to or is otherwise involved in any threatened,
pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (a “proceeding”)
by reason of the fact that he or she is or was a director or officer of the Corporation or, while a director or officer of the Corporation,
is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation or of a partnership,
joint venture, trust, other enterprise or nonprofit entity, including service with respect to an employee benefit plan (an “indemnitee”),
whether the basis of such proceeding is alleged action in an official capacity as a director, officer, employee or agent, or in any other
capacity while serving as a director, officer, employee or agent, against all liability and loss suffered and expenses (including, without
limitation, attorneys’ fees, judgments, fines, ERISA excise taxes and penalties and amounts paid in settlement) reasonably incurred
by such indemnitee in connection with such proceeding. The Corporation shall to the fullest extent not prohibited by applicable law pay
the expenses (including attorneys’ fees) incurred by an indemnitee in defending or otherwise participating in any proceeding in
advance of its final disposition; provided, however, that, to the extent required by applicable law, such payment of expenses in advance
of the final disposition of the proceeding shall be made only upon receipt of an undertaking, by or on behalf of the indemnitee, to repay
all amounts so advanced if it shall ultimately be determined that the indemnitee is not entitled to be indemnified under this Section
8.2 or otherwise. The rights to indemnification and advancement of expenses conferred by this Section 8.2 shall
be contract rights and such rights shall continue as to an indemnitee who has ceased to be a director, officer, employee or agent and
shall inure to the benefit of his or her heirs, executors and administrators. Notwithstanding the foregoing provisions of this Section
8.2(a), except for proceedings to enforce rights to indemnification and advancement of expenses, the Corporation shall indemnify and
advance expenses to an indemnitee in connection with a proceeding (or part thereof) initiated by such indemnitee only if such proceeding
(or part thereof) was authorized by the Board.
(b)
The rights to indemnification and advancement of expenses conferred on any indemnitee by this Section 8.2 shall not be
exclusive of any other rights that any indemnitee may have or hereafter acquire under law, this Second Amended and Restated Certificate,
the Bylaws, an agreement, vote of stockholders or disinterested directors, or otherwise.
(c)
Any repeal or amendment of this Section 8.2 by the stockholders of the Corporation or by changes in law, or the adoption
of any other provision of this Second Amended and Restated Certificate inconsistent with this Section 8.2, shall, unless otherwise
required by law, be prospective only (except to the extent such amendment or change in law permits the Corporation to provide broader
indemnification rights on a retroactive basis than permitted prior thereto), and shall 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 in respect of any proceeding
(regardless of when such proceeding is first threatened, commenced or completed) arising out of, or related to, any act or omission occurring
prior to such repeal or amendment or adoption of such inconsistent provision.
(d)
This Section 8.2 shall not limit the right of the Corporation, to the extent and in the manner authorized or permitted
by law, to indemnify and to advance expenses to persons other than indemnitees.
ARTICLE
IX
CORPORATE OPPORTUNITY
The
Corporation renounces any interest or expectancy of the Corporation in, or in being offered an opportunity to participate in, any Excluded
Opportunity. An “Excluded Opportunity” is any matter, transaction or interest that is presented to, or acquired,
created or developed by, or which otherwise comes into the possession of, any director of the Corporation who is not an employee or officer
of the Corporation or any of its subsidiaries (a “Covered Person”), unless such matter, transaction or interest
is presented to, or acquired, created or developed by, or otherwise comes into the possession of, a Covered Person expressly and solely
in such Covered Person’s capacity as a director of the Corporation.
ARTICLE
X
ANTITAKEOVER
The
Corporation expressly elects not to be governed by Section 203 of the DGCL.
ARTICLE
XI
AMENDMENT OF SECOND AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
THE
CORPORATION RESERVES THE RIGHT TO AMEND, ALTER, CHANGE OR REPEAL ANY PROVISION CONTAINED IN THIS SECONDED AMENDED AND RESTATED CERTIFICATE
OF INCORPORATION (INCLUDING ANY RIGHTS, PREFERENCES OR OTHER DESIGNATIONS OF PREFERRED STOCK), IN THE MANNER NOW OR HEREAFTER PRESCRIBED
BY THIS SECONDED AMENDED AND RESTATED CERTIFICATE OF INCORPORATION AND THE DGCL; AND ALL RIGHTS, PREFERENCES AND PRIVILEGES HEREIN CONFERRED
UPON STOCKHOLDERS BY AND PURSUANT TO THIS SECONDED AMENDED AND RESTATED CERTIFICATE OF INCORPORATION IN ITS PRESENT FORM OR AS HEREAFTER
AMENDED ARE GRANTED SUBJECT TO THE RIGHT RESERVED IN THIS ARTICLE IX.
ARTICLE
XII
EXCLUSIVE FORUM FOR CERTAIN LAWSUITS
Section
12.1 Forum. Unless the Corporation consents in writing to the selection of an alternative forum, the Court of Chancery
of the State of Delaware shall be the sole and exclusive forum for any stockholder (including a beneficial owner) to bring (i) any derivative
action or proceeding brought on behalf of the Corporation, (ii) any action asserting a claim of breach of a fiduciary duty owed by any
director, officer or other employee of the Corporation to the Corporation or the Corporation’s stockholders, (iii) any action asserting
a claim against the Corporation, its directors, officers or employees arising pursuant to any provision of the DGCL or this Second Amended
and Restated Certificate or the Bylaws, or (iv) any action asserting a claim against the Corporation, its directors, officers or employees
governed by the internal affairs doctrine and, if brought outside of Delaware, the stockholder bringing the suit will be deemed to have
consented to service of process on such stockholder’s counsel except any action (A) as to which the Court of Chancery in the State
of Delaware determines that there is an indispensable party not subject to the jurisdiction of the Court of Chancery (and the indispensable
party does not consent to the personal jurisdiction of the Court of Chancery within ten days following such determination), (B) which
is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery, (C) for which the Court of Chancery does
not have subject matter jurisdiction, or (D) any action arising under the Securities Act of 1933, as amended, as to which the Court of
Chancery and the federal district court for the District of Delaware shall have concurrent jurisdiction. Notwithstanding the foregoing,
the provisions of this Section 12.1 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 courts have exclusive jurisdiction.
Section
12.2 Consent to Jurisdiction. If any action the subject matter of which is within the scope of Section 12.1 immediately
above 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 (i) 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 Section 12.1 immediately
above (an “FSC Enforcement Action”) and (ii) having service of process made upon such stockholder in any such
FSC Enforcement Action by service upon such stockholder’s counsel in the Foreign Action as agent for such stockholder.
ARTICLE
XIII
SEVERABILITY
If
any provision or provisions (or any part thereof) of this Second Amended and Restated Certificate shall be held to be invalid, illegal
or unenforceable as applied to any person, entity or circumstance for any reason whatsoever, then, to the fullest extent permitted by
law, (i) the validity, legality and enforceability of such provisions in any other circumstance and of the remaining provisions of this
Second Amended and Restated Certificate (including, without limitation, each portion of any paragraph of this Second Amended and Restated
Certificate containing any such provision held to be invalid, illegal or unenforceable that is not itself held to be invalid, illegal
or unenforceable) and the application of such provision to other persons or entities and circumstances shall not in any way be affected
or impaired thereby, and (ii) the provisions of this Second Amended and Restated Certificate (including, without limitation, each portion
of any paragraph of this Second Amended and Restated Certificate containing any such provision held to be invalid, illegal or unenforceable)
shall be construed so as to permit the Corporation to protect its directors, officers, employees and agents from personal liability in
respect of their good faith service or for the benefit of the Corporation to the fullest extent permitted by law.
[Signature page follows.]
IN
WITNESS WHEREOF, Abri SPAC I, Inc. has caused this Second Amended and Restated Certificate to be duly executed and acknowledged in
its name and on its behalf by an authorized officer as of the date first set forth above.
| |
|
Abri SPAC I, Inc. |
| |
|
|
| |
|
By: |
|
|
| |
|
Name: |
|
|
| |
|
Title: |
|
|
Signature Page to Second
Amended and Restated Certificate of Incorporation
Annex C
AMENDED AND RESTATED
BYLAWS
OF
DATALOGIQ, INC.
(THE “CORPORATION”)
ARTICLE
I
OFFICES
Section
1.1 Registered Office. The registered office of the Corporation within the State of Delaware shall be located at either (a) the principal
place of business of the Corporation in the State of Delaware or (b) the office of the corporation or individual acting as the Corporation’s
registered agent in Delaware.
Section
1.2 Additional Offices. The Corporation may, in addition to its registered office in the State of Delaware, have such other offices
and places of business, both within and outside the State of Delaware, as the Board of Directors of the Corporation (the “Board”)
may from time to time determine or as the business and affairs of the Corporation may require.
ARTICLE
II
STOCKHOLDERS
Section
2.1 Annual Meetings. The annual meeting of stockholders shall be held at such place, either within or without the State of Delaware
and time and on such date as shall be determined by the Board and stated in the notice of the meeting; provided, that the
Board may in its sole discretion determine that the meeting shall not be held at any place, but may instead be held solely by means of
remote communication pursuant to Section 9.5(a). At each annual meeting, the stockholders entitled to vote on such matters
shall elect those directors of the Corporation to fill any term of a directorship that expires on the date of such annual meeting and
may transact any other business as may properly be brought before the meeting.
Section
2.2 Special Meetings. Subject to the requirements of applicable law, special meetings of stockholders of the Corporation may be called
only by the Chairman of the Board, the Chief Executive Officer of the Corporation or the Board pursuant to a resolution adopted by the
Board, and the ability of the stockholders of the Corporation to call a special meeting is hereby specifically denied. Except as provided
in the foregoing sentence, special meetings of stockholders of the Corporation may not be called by any other person or persons. Special
meetings of stockholders shall be held at such place, either within or without the State of Delaware, and at such and time and on such
date as shall be determined by the Board and stated in the Corporation’s notice of the meeting; provided, that the Board
may in its sole discretion determine that the meeting shall not be held at any place, but may instead be held solely by means of remote
communication pursuant to Section 9.5(a).
Section
2.3 Notices. Written notice of each stockholders meeting stating the place, if any, date, and time of the meeting, and the means of
remote communication, if any, by which stockholders and proxy holders may be deemed to be present in person and vote at such meeting and
the record date for determining the stockholders entitled to vote at the meeting, if such date is different from the record date for determining
stockholders entitled to notice of the meeting, shall be given in the manner permitted by Section 9.3 to each stockholder
entitled to vote thereat as of the record date for determining the stockholders entitled to notice of the meeting, by the Corporation
not less than 10 nor more than 60 days before the date of the meeting unless otherwise required by the General Corporation Law of the
State of Delaware (the “DGCL”). If said notice is for a stockholders meeting other than an annual meeting, it
shall in addition state the purpose or purposes for which the meeting is called, and the business transacted at such meeting shall be
limited to the matters so stated in the Corporation’s notice of meeting (or any supplement thereto). Any meeting of stockholders
as to which notice has been given may be postponed, and any meeting of stockholders as to which notice has been given may be cancelled,
by the Board upon public announcement (as defined in Section 2.7(c)) given before the date previously scheduled for such meeting.
Section
2.4 Quorum. Except as otherwise provided by applicable law, the Corporation’s Second Amended and Restated Certificate of Incorporation,
as the same may be amended or restated from time to time (the “Certificate of Incorporation”) or these Bylaws,
the presence, in person or by proxy, at a stockholders meeting of the holders of shares of outstanding capital stock of the Corporation
representing a majority of the voting power of all outstanding shares of capital stock of the Corporation entitled to vote at such meeting
shall constitute a quorum for the transaction of business at such meeting, except that when specified business is to be voted on by a
class or series of stock voting as a class, the holders of shares representing a majority of the voting power of the outstanding shares
of such class or series shall constitute a quorum of such class or series for the transaction of such business. If a quorum shall not
be present or represented by proxy at any meeting of the stockholders of the Corporation, the chairman of the meeting may adjourn the
meeting from time to time in the manner provided in Section 2.6 until a quorum shall attend. The stockholders present
at a duly convened meeting may continue to transact business until adjournment, notwithstanding the withdrawal of enough stockholders
to leave less than a quorum. Shares of its own stock belonging to the Corporation or to another corporation, if a majority of the voting
power of the shares entitled to vote in the election of directors of such other corporation is held, directly or indirectly, by the Corporation,
shall neither be entitled to vote nor be counted for quorum purposes; provided, however, that the foregoing shall
not limit the right of the Corporation or any such other corporation to vote shares held by it in a fiduciary capacity.
Section
2.5 Voting of Shares.
(a) Voting
Lists. The Secretary of the Corporation (the “Secretary”) shall prepare, or shall cause the officer or agent
who has charge of the stock ledger of the Corporation to prepare and make, at least 10 days before every meeting of stockholders, a complete
list of the stockholders of record entitled to vote at such meeting; provided, however, that if the record date
for determining the stockholders entitled to vote is less than 10 days before the meeting date, the list shall reflect the stockholders
entitled to vote as of the tenth day before the meeting date, arranged in alphabetical order and showing the address and the number and
class of shares registered in the name of each stockholder. Nothing contained in this Section 2.5(a) shall require the
Corporation to include electronic mail addresses or other electronic contact information on such list. Such list shall be open to the
examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours for a period of at least 10 days
prior to the meeting: (i) on a reasonably accessible electronic network, provided that the information required to gain access to such
list is provided with the notice of the meeting, or (ii) during ordinary business hours, at the principal place of business of the Corporation.
In the event that the Corporation determines to make the list available on an electronic network, the Corporation may take reasonable
steps to ensure that such information is available only to stockholders of the Corporation. If the meeting is to be held at a place, then
the list shall be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder
who is present. If a meeting of stockholders is to be held solely by means of remote communication as permitted by Section 9.5(a),
the list shall be open to the examination of any stockholder during the whole time of the meeting on a reasonably accessible electronic
network, and the information required to access such list shall be provided with the notice of meeting. The stock ledger shall be the
only evidence as to who are the stockholders entitled to examine the list required by this Section 2.5(a) or to vote
in person or by proxy at any meeting of stockholders.
(b) Manner
of Voting. At any stockholders meeting, every stockholder entitled to vote may vote in person or by proxy. If authorized by the Board,
the voting by stockholders or proxy holders at any meeting conducted by remote communication may be effected by a ballot submitted by
electronic transmission (as defined in Section 9.3), provided, that any such electronic transmission must either
set forth or be submitted with information from which the Corporation can determine that the electronic transmission was authorized by
the stockholder or proxy holder. The Board, in its discretion, or the chairman of the meeting of stockholders, in such person’s
discretion, may require that any votes cast at such meeting shall be cast by written ballot.
(c) Proxies.
Each stockholder entitled to vote at a meeting of stockholders or to express consent or dissent to corporate action in writing without
a meeting may authorize another person or persons to act for such stockholder by proxy, but no such proxy shall be voted or acted upon
after three years from its date, unless the proxy provides for a longer period. Proxies need not be filed with the Secretary until the
meeting is called to order, but shall be filed with the Secretary before being voted. Without limiting the manner in which a stockholder
may authorize another person or persons to act for such stockholder as proxy, either of the following shall constitute a valid means by
which a stockholder may grant such authority. No stockholder shall have cumulative voting rights.
(i)
A stockholder may execute a writing authorizing another person or persons to act for such stockholder as proxy. Execution may be accomplished
by the stockholder or such stockholder’s authorized officer, director, employee or agent signing such writing or causing such person’s
signature to be affixed to such writing by any reasonable means, including, but not limited to, by facsimile signature.
(ii)
A stockholder may authorize another person or persons to act for such stockholder as proxy by transmitting or authorizing the transmission
of an electronic transmission to the person who will be the holder of the proxy or to a proxy solicitation firm, proxy support service
organization or like agent duly authorized by the person who will be the holder of the proxy to receive such transmission, provided,
that any such electronic transmission must either set forth or be submitted with information from which it can be determined that the
electronic transmission was authorized by the stockholder. Any copy, facsimile telecommunication or other reliable reproduction of the
writing or transmission authorizing another person or persons to act as proxy for a stockholder may be substituted or used in lieu of
the original writing or transmission for any and all purposes for which the original writing or transmission could be used; provided,
that such copy, facsimile telecommunication or other reproduction shall be a complete reproduction of the entire original writing or transmission.
(d) Required
Vote. At all meetings of stockholders at which a quorum is present, the election of directors shall be determined by a plurality of
the votes cast by the stockholders present in person or represented by proxy at the meeting and entitled to vote thereon. All other matters
presented to the stockholders at a meeting at which a quorum is present shall be determined by the vote of a majority of the votes cast
by the stockholders present in person or represented by proxy at the meeting and entitled to vote thereon, unless the matter is one upon
which, by applicable law, the Certificate of Incorporation, these Bylaws or applicable stock exchange rules, a different vote is required,
in which case such provision shall govern and control the decision of such matter.
(e) Inspectors
of Election. The Board may, and shall if required by law, in advance of any meeting of stockholders, designate one or more persons
as inspectors of election, who may be employees of the Corporation or otherwise serve the Corporation in other capacities, to act at such
meeting of stockholders or any adjournment thereof and to make a written report thereof. The Board may appoint one or more persons as
alternate inspectors to replace any inspector who fails to act. If no inspectors of election or alternates are appointed by the Board,
the chairman of the meeting shall appoint one or more inspectors to act at the meeting. Each inspector, before discharging his or her
duties, shall take and sign an oath faithfully to execute the duties of inspector with strict impartiality and according to the best of
his or her ability. The inspectors shall ascertain and report the number of outstanding shares and the voting power of each; determine
the number of shares present in person or represented by proxy at the meeting and the validity of proxies and ballots; count all votes
and ballots and report the results; determine and retain for a reasonable period a record of the disposition of any challenges made to
any determination by the inspectors; and certify their determination of the number of shares represented at the meeting and their count
of all votes and ballots. No person who is a candidate for an office at an election may serve as an inspector at such election. Each report
of an inspector shall be in writing and signed by the inspector or by a majority of them if there is more than one inspector acting at
such meeting. If there is more than one inspector, the report of a majority shall be the report of the inspectors.
Section
2.6 Adjournments. Any meeting of stockholders, annual or special, may be adjourned by the chairman of the meeting, from time to time,
whether or not there is a quorum, to reconvene at the same or some other place. Notice need not be given of any such adjourned meeting
if the date, time, and place, if any, thereof, and the means of remote communication, if any, by which stockholders and proxy holders
may be deemed to be present in person and vote at such adjourned meeting are announced at the meeting at which the adjournment is taken.
At the adjourned meeting the stockholders, or the holders of any class or series of stock entitled to vote separately as a class, as the
case may be, may transact any business that might have been transacted at the original meeting. If the adjournment is for more than 30
days, notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting. If after the adjournment
a new record date for stockholders entitled to vote is fixed for the adjourned meeting, the Board shall fix a new record date for notice
of such adjourned meeting in accordance with Section 9.2, and shall give notice of the adjourned meeting to each stockholder
of record entitled to vote at such adjourned meeting as of the record date fixed for notice of such adjourned meeting.
Section
2.7 Advance Notice for Business.
(a) Annual
Meetings of Stockholders. No business may be transacted at an annual meeting of stockholders, other than business that is either (i)
specified in the Corporation’s notice of meeting (or any supplement thereto) given by or at the direction of the Board, (ii) otherwise
properly brought before the annual meeting by or at the direction of the Board or (iii) otherwise properly brought before the annual meeting
by any stockholder of the Corporation (x) who is a stockholder of record entitled to vote at such annual meeting on the date of the
giving of the notice provided for in this Section 2.7(a) and on the record date for the determination of stockholders
entitled to vote at such annual meeting and (y) who complies with the notice procedures set forth in this Section 2.7(a).
Notwithstanding anything in this Section 2.7(a) to the contrary, only persons nominated for election as a director to
fill any term of a directorship that expires on the date of the annual meeting pursuant to Section 3.2 will be considered
for election at such meeting.
(i)
In addition to any other applicable requirements, for business (other than nominations) to be properly brought before an annual meeting
by a stockholder, such stockholder must have given timely notice thereof in proper written form to the Secretary and such business must
otherwise be a proper matter for stockholder action. Subject to Section 2.7(a)(iii), a stockholder’s notice to the Secretary
with respect to such business, to be timely, must be received by the Secretary at the principal executive offices of the Corporation not
later than the close of business on the 90th day nor earlier than the opening of business on the 120th day
before the anniversary date of the immediately preceding annual meeting of stockholders; provided, however, that
in the event that the annual meeting is called for a date that is not within 30 days before or after such anniversary date, notice by
the stockholder to be timely must be so received not earlier than the opening of business on the 120th day before
the meeting and not later than the later of (x) the close 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 the Corporation. The public announcement of an adjournment of an annual meeting shall not commence a new time period for
the giving of a stockholder’s notice as described in this Section 2.7(a).
(ii)
To be in proper written form, a stockholder’s notice to the Secretary with respect to any business (other than nominations) must
set forth as to each such matter such stockholder proposes to bring before the annual meeting (A) a brief description of the business
desired to be brought before the annual meeting, the text of the proposal or business (including the text of any resolutions proposed
for consideration and in the event such business includes a proposal to amend these Bylaws, the language of the proposed amendment) and
the reasons for conducting such business at the annual meeting, (B) the name and record address of such stockholder and the name and address
of the beneficial owner, if any, on whose behalf the proposal is made, (C) the class or series and number of shares of capital stock of
the Corporation that are owned beneficially and of record by such stockholder and by the beneficial owner, if any, on whose behalf the
proposal is made, (D) a description of all arrangements or understandings between such stockholder and the beneficial owner, if any, on
whose behalf the proposal is made and any other person or persons (including their names) in connection with the proposal of such business
by such stockholder, (E) any material interest of such stockholder and the beneficial owner, if any, on whose behalf the proposal is made
in such business and (F) a representation that such stockholder (or a qualified representative of such stockholder) intends to appear
in person or by proxy at the annual meeting to bring such business before the meeting.
(iii)
The foregoing notice requirements of this Section 2.7(a) shall be deemed satisfied by a stockholder as to any proposal
(other than nominations) if the stockholder has notified the Corporation of such stockholder’s intention to present such proposal
at an annual meeting in compliance with Rule 14a-8 (or any successor thereof) of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), and such stockholder has complied with the requirements of such rule for inclusion of such
proposal in a proxy statement prepared by the Corporation to solicit proxies for such annual meeting. No business shall be conducted at
the annual meeting of stockholders except business brought before the annual meeting in accordance with the procedures set forth in this Section
2.7(a), provided, however, that once business has been properly brought before the annual meeting in accordance
with such procedures, nothing in this Section 2.7(a) shall be deemed to preclude discussion by any stockholder of any
such business. If the Board or the chairman of the annual meeting determines that any stockholder proposal was not made in accordance
with the provisions of this Section 2.7(a) or that the information provided in a stockholder’s notice does not
satisfy the information requirements of this Section 2.7(a), such proposal shall not be presented for action at the annual
meeting. Notwithstanding the foregoing provisions of this Section 2.7(a), if the stockholder (or a qualified representative
of the stockholder) does not appear at the annual meeting of stockholders of the Corporation to present the proposed business, such proposed
business shall not be transacted, notwithstanding that proxies in respect of such matter may have been received by the Corporation.
(iv)
In addition to the provisions of this Section 2.7(a), a stockholder shall also comply with all applicable requirements of
the Exchange Act and the rules and regulations thereunder with respect to the matters set forth herein. Nothing in this Section
2.7(a) shall be deemed to affect any rights of stockholders to request inclusion of proposals in the Corporation’s proxy
statement pursuant to Rule 14a-8 under the Exchange Act.
(b) Special
Meetings of Stockholders. Only such business shall be conducted at a special meeting of stockholders as shall have been brought before
the meeting pursuant to the Corporation’s notice of meeting. Nominations of persons for election to the Board may be made at a special
meeting of stockholders at which directors are to be elected pursuant to the Corporation’s notice of meeting only pursuant to Section
3.2.
(c) Public
Announcement. For purposes of these Bylaws, “public announcement” shall mean disclosure in a press release
reported by the Dow Jones News Service, Associated Press or comparable national news service or in a document publicly filed by the Corporation
with the Securities and Exchange Commission pursuant to Sections 13, 14 or 15(d) of the Exchange Act (or any successor thereto).
Section
2.8 Conduct of Meetings. The chairman of each annual and special meeting of stockholders shall be the Chairman of the Board or, in
the absence (or inability or refusal to act) of the Chairman of the Board, the Chief Executive Officer (if he or she shall be a director)
or, in the absence (or inability or refusal) to act of the Chief Executive Officer or if the Chief Executive Officer is not a director,
the President (if he or she shall be a director) or, in the absence (or inability or refusal to act) of the President or if the President
is not a director, such other person as shall be appointed by the Board. The date and time of the opening and the closing of the polls
for each matter upon which the stockholders will vote at a meeting shall be announced at the meeting by the chairman of the meeting. The
Board may adopt such rules and regulations for the conduct of the meeting of stockholders as it shall deem appropriate. Except to the
extent inconsistent with these Bylaws or such rules and regulations as adopted by the Board, the chairman of any meeting of stockholders
shall have the right and authority to convene and to adjourn the meeting, to prescribe such rules, regulations and procedures and to do
all such acts as, in the judgment of such chairman, are appropriate for the proper conduct of the meeting. Such rules, regulations or
procedures, whether adopted by the Board or prescribed by the chairman of the meeting, may include, without limitation, the following:
(a) the establishment of an agenda or order of business for the meeting; (b) rules and procedures for maintaining order at the meeting
and the safety of those present; (c) limitations on attendance at or participation in the meeting to stockholders of record of the Corporation,
their duly authorized and constituted proxies or such other persons as the chairman of the meeting shall determine; (d) restrictions on
entry to the meeting after the time fixed for the commencement thereof; and (e) limitations on the time allotted to questions or
comments by participants. Unless and to the extent determined by the Board or the chairman of the meeting, meetings of stockholders shall
not be required to be held in accordance with the rules of parliamentary procedure. The secretary of each annual and special meeting of
stockholders shall be the Secretary or, in the absence (or inability or refusal to act) of the Secretary, an Assistant Secretary so appointed
to act by the chairman of the meeting. In the absence (or inability or refusal to act) of the Secretary and all Assistant Secretaries,
the chairman of the meeting may appoint any person to act as secretary of the meeting.
ARTICLE
III
DIRECTORS
Section
3.1 Powers. The business and affairs of the Corporation shall be managed by or under the direction of the Board, which may exercise
all such powers of the Corporation and do all such lawful acts and things as are not by statute or by the Certificate of Incorporation
or by these Bylaws required to be exercised or done by the stockholders. Directors need not be stockholders or residents of the State
of Delaware.
Section
3.2 Advance Notice for Nomination of Directors.
(a)
Only persons who are nominated in accordance with the following procedures shall be eligible for election as directors of the Corporation.
Nominations of persons for election to the Board at any annual meeting of stockholders, or at any special meeting of stockholders called
for the purpose of electing directors as set forth in the Corporation’s notice of such special meeting, may be made (i) by or at
the direction of the Board or (ii) by any stockholder of the Corporation (x) who is a stockholder of record entitled to vote in the election
of directors on the date of the giving of the notice provided for in this Section 3.2 and on the record date for the
determination of stockholders entitled to vote at such meeting and (y) who complies with the notice procedures set forth in this Section
3.2.
(b)
In addition to any other applicable requirements, for a nomination to be made by a stockholder, such stockholder must have given timely
notice thereof in proper written form to the Secretary. To be timely, a stockholder’s notice to the Secretary must be received by
the Secretary at the principal executive offices of the Corporation (i) in the case of an annual meeting, not later than the close of
business on the 90th day nor earlier than the opening of business on the 120th day before the anniversary
date of the immediately preceding annual meeting of stockholders; provided, however, that in the event that the
annual meeting is called for a date that is not within 30 days before or after such anniversary date, notice by the stockholder to be
timely must be so received not earlier than the opening of business on the 120th day before the meeting and not later
than the later of (x) the close 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 was first made by the Corporation; and (ii) in the case
of a special meeting of stockholders called for the purpose of electing directors, not later than the close of business on the 10th day
following the day on which public announcement of the date of the special meeting is first made by the Corporation. In no event shall
the public announcement of an adjournment or postponement of an annual meeting or special meeting commence a new time period (or extend
any time period) for the giving of a stockholder’s notice as described in this Section 3.2.
(c)
Notwithstanding anything in paragraph (b) to the contrary, in the event that the number of directors to be elected to the Board at an
annual meeting is greater than the number of directors whose terms expire on the date of the annual meeting and there is no public announcement
by the Corporation naming all of the nominees for the additional directors to be elected or specifying the size of the increased Board
before the close of business on the 90th day prior to the anniversary date of the immediately preceding annual meeting
of stockholders, a stockholder’s notice required by this Section 3.2 shall also be considered timely, but only
with respect to nominees for the additional directorships created by such increase that are to be filled by election at such annual meeting,
if it shall be received by the Secretary at the principal executive offices of the Corporation not later than the close of business on
the 10th day following the date on which such public announcement was first made by the Corporation.
(d)
To be in proper written form, a stockholder’s notice to the Secretary must set forth (i) as to each person whom the stockholder
proposes to nominate for election as a director (A) the name, age, business address and residence address of the person, (B) the principal
occupation or employment of the person, (C) the class or series and number of shares of capital stock of the Corporation that are owned
beneficially or of record by the person and (D) any other information relating to the person that would be required to be disclosed in
a proxy statement or other filings required to be made in connection with solicitations of proxies for election of directors pursuant
to Section 14 of the Exchange Act and the rules and regulations promulgated thereunder; and (ii) as to the stockholder giving the
notice (A) the name and record address of such stockholder as they appear on the Corporation’s books and the name and address of
the beneficial owner, if any, on whose behalf the nomination is made, (B) the class or series and number of shares of capital stock of
the Corporation that are owned beneficially and of record by such stockholder and the beneficial owner, if any, on whose behalf the nomination
is made, (C) a description of all arrangements or understandings relating to the nomination to be made by such stockholder among such
stockholder, the beneficial owner, if any, on whose behalf the nomination is made, each proposed nominee and any other person or persons
(including their names), (D) a representation that such stockholder (or a qualified representative of such stockholder) intends to appear
in person or by proxy at the meeting to nominate the persons named in its notice and (E) any other information relating to such stockholder
and the beneficial owner, if any, on whose behalf the nomination is made that would be required to be disclosed in a proxy statement or
other filings required to be made in connection with solicitations of proxies for election of directors pursuant to Section 14 of the
Exchange Act and the rules and regulations promulgated thereunder. Such notice must be accompanied by a written consent of each proposed
nominee to being named as a nominee and to serve as a director if elected.
(e)
If the Board or the chairman of the meeting of stockholders determines that any nomination was not made in accordance with the provisions
of this Section 3.2, or that the information provided in a stockholder’s notice does not satisfy the information requirements
of this Section 3.2, then such nomination shall not be considered at the meeting in question. Notwithstanding the foregoing
provisions of this Section 3.2, if the stockholder (or a qualified representative of the stockholder) does not appear at the
meeting of stockholders of the Corporation to present the nomination, such nomination shall be disregarded, notwithstanding that proxies
in respect of such nomination may have been received by the Corporation.
(f)
In addition to the provisions of this Section 3.2, a stockholder shall also comply with all of the applicable requirements
of the Exchange Act and the rules and regulations thereunder with respect to the matters set forth herein.
Section
3.3 Compensation. Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, the Board shall have the authority
to fix the compensation of directors. The directors may be reimbursed their expenses, if any, of attendance at each meeting of the Board,
including for service on a committee of the Board, and may be paid either a fixed sum for attendance at each meeting of the Board or other
compensation as director. No such payment shall preclude any director from serving the Corporation in any other capacity and receiving
compensation therefor. Members of committees of the Board may be allowed like compensation and reimbursement of expenses for service on
the committee.
ARTICLE
IV
BOARD MEETINGS
Section
4.1 Annual Meetings. The Board shall meet as soon as practicable after the adjournment of each annual stockholders meeting at the
place of the annual stockholders meeting unless the Board shall fix another time and place and give notice thereof in the manner required
herein for special meetings of the Board. No notice to the directors shall be necessary to legally convene this meeting, except as provided
in this Section 4.1.
Section
4.2 Regular Meetings. Regularly scheduled, periodic meetings of the Board may be held without notice at such times, dates and places
(within or without the State of Delaware) as shall from time to time be determined by the Board.
Section
4.3 Special Meetings. Special meetings of the Board (a) may be called by the Chairman of the Board or President and (b) shall be called
by the Chairman of the Board, President or Secretary on the written request of at least a majority of directors then in office, or the
sole director, as the case may be, and shall be held at such time, date and place (within or without the State of Delaware) as may be
determined by the person calling the meeting or, if called upon the request of directors or the sole director, as specified in such written
request. Notice of each special meeting of the Board shall be given, as provided in Section 9.3, to each director (i) at least
24 hours before the meeting if such notice is oral notice given personally or by telephone or written notice given by hand delivery or
by means of a form of electronic transmission and delivery; (ii) at least two days before the meeting if such notice is sent by a nationally
recognized overnight delivery service; and (iii) at least five days before the meeting if such notice is sent through the United States
mail. If the Secretary shall fail or refuse to give such notice, then the notice may be given by the officer who called the meeting or
the directors who requested the meeting. Any and all business that may be transacted at a regular meeting of the Board may be transacted
at a special meeting. Except as may be otherwise expressly provided by applicable law, the Certificate of Incorporation, or these Bylaws,
neither the business to be transacted at, nor the purpose of, any special meeting need be specified in the notice or waiver of notice
of such meeting. A special meeting may be held at any time without notice if all the directors are present or if those not present waive
notice of the meeting in accordance with Section 9.4.
Section
4.4 Quorum; Required Vote. A majority of the Board shall constitute a quorum for the transaction of business at any meeting of the
Board, and the act of a majority of the directors present at any meeting at which there is a quorum shall be the act of the Board, except
as may be otherwise specifically provided by applicable law, the Certificate of Incorporation or these Bylaws. If a quorum shall not be
present at any meeting, a majority of the directors present may adjourn the meeting from time to time, without notice other than announcement
at the meeting, until a quorum is present.
Section
4.5 Consent In Lieu of Meeting. Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, any action required
or permitted to be taken at any meeting of the Board or any committee thereof may be taken without a meeting if all members of the Board
or committee, as the case may be, consent thereto in writing or by electronic transmission, and the writing or writings or electronic
transmission or transmissions (or paper reproductions thereof) are filed with the minutes of proceedings of the Board or committee. Such
filing shall be in paper form if the minutes are maintained in paper form and shall be in electronic form if the minutes are maintained
in electronic form.
Section
4.6 Organization. The chairman of each meeting of the Board shall be the Chairman of the Board or, in the absence (or inability or
refusal to act) of the Chairman of the Board, the Chief Executive Officer (if he or she shall be a director) or, in the absence (or inability
or refusal to act) of the Chief Executive Officer or if the Chief Executive Officer is not a director, the President (if he or she shall
be a director) or in the absence (or inability or refusal to act) of the President or if the President is not a director, a chairman elected
from the directors present. The Secretary shall act as secretary of all meetings of the Board. In the absence (or inability or refusal
to act) of the Secretary, an Assistant Secretary shall perform the duties of the Secretary at such meeting. In the absence (or inability
or refusal to act) of the Secretary and all Assistant Secretaries, the chairman of the meeting may appoint any person to act as secretary
of the meeting.
ARTICLE
V
COMMITTEES OF DIRECTORS
Section
5.1 Establishment. The Board may by resolution passed by a majority of the Board designate one or more committees, each committee
to consist of one or more of the directors of the Corporation. Each committee shall keep regular minutes of its meetings and report the
same to the Board when required. The Board shall have the power at any time to fill vacancies in, to change the membership of, or to dissolve
any such committee.
Section
5.2 Available Powers. Any committee established pursuant to Section 5.1 hereof, to the extent permitted by applicable
law and by resolution of the Board, shall have and may exercise all of the powers and authority of the Board in the management of the
business and affairs of the Corporation, and may authorize the seal of the Corporation to be affixed to all papers that may require it.
Section
5.3 Alternate Members. The Board may designate one or more directors as alternate members of any committee, who may replace any absent
or disqualified member at any meeting of such committee. In the absence or disqualification of a member of the committee, the member or
members thereof present at any meeting and not disqualified from voting, whether or not he, she or they constitute a quorum, may unanimously
appoint another member of the Board to act at the meeting in place of any such absent or disqualified member.
Section
5.4 Procedures. Unless the Board otherwise provides, the time, date, place, if any, and notice of meetings of a committee shall be
determined by such committee. At meetings of a committee, a majority of the number of members of the committee (but not including any
alternate member, unless such alternate member has replaced any absent or disqualified member at the time of, or in connection with, such
meeting) shall constitute a quorum for the transaction of business. The act of a majority of the members present at any meeting at which
a quorum is present shall be the act of the committee, except as otherwise specifically provided by applicable law, the Certificate of
Incorporation, these Bylaws or the Board. If a quorum is not present at a meeting of a committee, the members present may adjourn the
meeting from time to time, without notice other than an announcement at the meeting, until a quorum is present. Unless the Board otherwise
provides and except as provided in these Bylaws, each committee designated by the Board may make, alter, amend and repeal rules for the
conduct of its business. In the absence of such rules each committee shall conduct its business in the same manner as the Board is authorized
to conduct its business pursuant to Article III and Article IV of these Bylaws.
ARTICLE
VI
OFFICERS
Section
6.1 Officers. The officers of the Corporation elected by the Board shall be a Chairman of the Board, a Chief Executive Officer, a
President, a Chief Financial Officer, a Secretary and such other officers (including without limitation, Vice Presidents, Assistant Secretaries
and a Treasurer) as the Board from time to time may determine. Officers elected by the Board shall each have such powers and duties as
generally pertain to their respective offices, subject to the specific provisions of this Article VI. Such officers shall
also have such powers and duties as from time to time may be conferred by the Board. The Chief Executive Officer or President may also
appoint such other officers (including without limitation one or more Vice Presidents and Controllers) as may be necessary or desirable
for the conduct of the business of the Corporation. Such other officers shall have such powers and duties and shall hold their offices
for such terms as may be provided in these Bylaws or as may be prescribed by the Board or, if such officer has been appointed by the Chief
Executive Officer or President, as may be prescribed by the appointing officer.
(a) Chairman
of the Board. The Chairman of the Board shall preside when present at all meetings of the stockholders and the Board. The Chairman
of the Board shall have general supervision and control of the acquisition activities of the Corporation subject to the ultimate authority
of the Board, and shall be responsible for the execution of the policies of the Board with respect to such matters. In the absence (or
inability or refusal to act) of the Chairman of the Board, the Chief Executive Officer (if he or she shall be a director) shall preside
when present at all meetings of the stockholders and the Board. The powers and duties of the Chairman of the Board shall not include supervision
or control of the preparation of the financial statements of the Corporation (other than through participation as a member of the Board).
The position of Chairman of the Board and Chief Executive Officer may be held by the same person.
(b) Chief
Executive Officer. The Chief Executive Officer shall be the chief executive officer of the Corporation, shall have general supervision
of the affairs of the Corporation and general control of all of its business subject to the ultimate authority of the Board, and shall
be responsible for the execution of the policies of the Board with respect to such matters, except to the extent any such powers and duties
have been prescribed to the Chairman of the Board pursuant to Section 6.1(a) above. In the absence (or inability or refusal
to act) of the Chairman of the Board, the Chief Executive Officer (if he or she shall be a director) shall preside when present at all
meetings of the stockholders and the Board. The position of Chief Executive Officer and President may be held by the same person.
(c) President.
The President shall make recommendations to the Chief Executive Officer on all operational matters that would normally be reserved for
the final executive responsibility of the Chief Executive Officer. In the absence (or inability or refusal to act) of the Chairman of
the Board and Chief Executive Officer, the President (if he or she shall be a director) shall preside when present at all meetings of
the stockholders and the Board. The President shall also perform such duties and have such powers as shall be designated by the Board.
The position of President and Chief Executive Officer may be held by the same person.
(d) Vice
Presidents. In the absence (or inability or refusal to act) of the President, the Vice President (or in the event there be more than
one Vice President, the Vice Presidents in the order designated by the Board) shall perform the duties and have the powers of the President.
Any one or more of the Vice Presidents may be given an additional designation of rank or function.
(e) Secretary.
(i)
The Secretary shall attend all meetings of the stockholders, the Board and (as required) committees of the Board and shall record the
proceedings of such meetings in books to be kept for that purpose. The Secretary shall give, or cause to be given, notice of all meetings
of the stockholders and special meetings of the Board and shall perform such other duties as may be prescribed by the Board, the Chairman
of the Board, Chief Executive Officer or President. The Secretary shall have custody of the corporate seal of the Corporation and the
Secretary, or any Assistant Secretary, shall have authority to affix the same to any instrument requiring it, and when so affixed, it
may be attested by his or her signature or by the signature of such Assistant Secretary. The Board may give general authority to any other
officer to affix the seal of the Corporation and to attest the affixing thereof by his or her signature.
(ii)
The Secretary shall keep, or cause to be kept, at the principal executive office of the Corporation or at the office of the Corporation’s
transfer agent or registrar, if one has been appointed, a stock ledger, or duplicate stock ledger, showing the names of the stockholders
and their addresses, the number and classes of shares held by each and, with respect to certificated shares, the number and date of certificates
issued for the same and the number and date of certificates cancelled.
(f) Assistant
Secretaries. The Assistant Secretary or, if there be more than one, the Assistant Secretaries in the order determined by the Board
shall, in the absence (or inability or refusal to act) of the Secretary, perform the duties and have the powers of the Secretary.
(g) Chief
Financial Officer. The Chief Financial Officer shall perform all duties commonly incident to that office (including, without limitation,
the care and custody of the funds and securities of the Corporation, which from time to time may come into the Chief Financial Officer’s
hands and the deposit of the funds of the Corporation in such banks or trust companies as the Board, the Chief Executive Officer or the
President may authorize).
(h) Treasurer.
The Treasurer shall, in the absence (or inability or refusal to act) of the Chief Financial Officer, perform the duties and exercise the
powers of the Chief Financial Officer.
Section
6.2 Term of Office; Removal; Vacancies. The elected officers of the Corporation shall be appointed by the Board and shall hold office
until their successors are duly elected and qualified by the Board or until their earlier death, resignation, retirement, disqualification,
or removal from office. Any officer may be removed, with or without cause, at any time by the Board. Any officer appointed by the Chief
Executive Officer or President may also be removed, with or without cause, by the Chief Executive Officer or President, as the case may
be, unless the Board otherwise provides. Any vacancy occurring in any elected office of the Corporation may be filled by the Board. Any
vacancy occurring in any office appointed by the Chief Executive Officer or President may be filled by the Chief Executive Officer, or
President, as the case may be, unless the Board then determines that such office shall thereupon be elected by the Board, in which case
the Board shall elect such officer.
Section
6.3 Other Officers. The Board may delegate the power to appoint such other officers and agents, and may also remove such officers
and agents or delegate the power to remove same, as it shall from time to time deem necessary or desirable.
Section
6.4 Multiple Officeholders; Stockholder and Director Officers. Any number of offices may be held by the same person unless the Certificate
of Incorporation or these Bylaws otherwise provide. Officers need not be stockholders or residents of the State of Delaware.
ARTICLE
VII
SHARES
Section
7.1 Certificated and Uncertificated Shares. The shares of the Corporation may be certificated or uncertificated, subject to the sole
discretion of the Board and the requirements of the DGCL.
Section
7.2 Multiple Classes of Stock. If the Corporation shall be authorized to issue more than one class of stock or more than one series
of any class, the Corporation shall (a) cause the powers, designations, preferences and relative, participating, optional or other special
rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights
to be set forth in full or summarized on the face or back of any certificate that the Corporation issues to represent shares of such class
or series of stock or (b) in the case of uncertificated shares, within a reasonable time after the issuance or transfer of such shares,
send to the registered owner thereof a written notice containing the information required to be set forth on certificates as specified
in clause (a) above; provided, however, that, except as otherwise provided by applicable law, in lieu of
the foregoing requirements, there may be set forth on the face or back of such certificate or, in the case of uncertificated shares, on
such written notice a statement that the Corporation will furnish without charge to each stockholder who so requests the powers, designations,
preferences and relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications,
limitations or restrictions of such preferences or rights.
Section
7.3 Signatures. Each certificate representing capital stock of the Corporation shall be signed by or in the name of the Corporation
by (a) the Chairman of the Board, Chief Executive Officer, the President or a Vice President and (b) the Treasurer, an Assistant Treasurer,
the Secretary or an Assistant Secretary of the Corporation. Any or all the signatures on the certificate may be a facsimile. In case any
officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased
to be such officer, transfer agent or registrar before such certificate is issued, such certificate may be issued by the Corporation with
the same effect as if such person were such officer, transfer agent or registrar on the date of issue.
Section
7.4 Consideration and Payment for Shares.
(a)
Subject to applicable law and the Certificate of Incorporation, shares of stock may be issued for such consideration, having in the case
of shares with par value a value not less than the par value thereof, and to such persons, as determined from time to time by the Board.
The consideration may consist of any tangible or intangible property or any benefit to the Corporation including cash, promissory notes,
services performed, contracts for services to be performed or other securities, or any combination thereof.
(b)
Subject to applicable law and the Certificate of Incorporation, shares may not be issued until the full amount of the consideration has
been paid, unless upon the face or back of each certificate issued to represent any partly paid shares of capital stock or upon the books
and records of the Corporation in the case of partly paid uncertificated shares, there shall have been set forth the total amount of the
consideration to be paid therefor and the amount paid thereon up to and including the time said certificate representing certificated
shares or said uncertificated shares are issued.
Section
7.5 Lost, Destroyed or Wrongfully Taken Certificates.
(a)
If an owner of a certificate representing shares claims that such certificate has been lost, destroyed or wrongfully taken, the Corporation
shall issue a new certificate representing such shares or such shares in uncertificated form if the owner: (i) requests such a new certificate
before the Corporation has notice that the certificate representing such shares has been acquired by a protected purchaser; (ii) if requested
by the Corporation, delivers to the Corporation a bond sufficient to indemnify the Corporation against any claim that may be made against
the Corporation on account of the alleged loss, wrongful taking or destruction of such certificate or the issuance of such new certificate
or uncertificated shares; and (iii) satisfies other reasonable requirements imposed by the Corporation.
(b)
If a certificate representing shares has been lost, apparently destroyed or wrongfully taken, and the owner fails to notify the Corporation
of that fact within a reasonable time after the owner has notice of such loss, apparent destruction or wrongful taking and the Corporation
registers a transfer of such shares before receiving notification, the owner shall be precluded from asserting against the Corporation
any claim for registering such transfer or a claim to a new certificate representing such shares or such shares in uncertificated form.
Section
7.6 Transfer of Stock.
(a)
If a certificate representing shares of the Corporation is presented to the Corporation with an endorsement requesting the registration
of transfer of such shares or an instruction is presented to the Corporation requesting the registration of transfer of uncertificated
shares, the Corporation shall register the transfer as requested if:
(i)
in the case of certificated shares, the certificate representing such shares has been surrendered;
(ii)
(A) with respect to certificated shares, the endorsement is made by the person specified by the certificate as entitled to such shares;
(B) with respect to uncertificated shares, an instruction is made by the registered owner of such uncertificated shares; or (C) with respect
to certificated shares or uncertificated shares, the endorsement or instruction is made by any other appropriate person or by an agent
who has actual authority to act on behalf of the appropriate person;
(iii)
the Corporation has received a guarantee of signature of the person signing such endorsement or instruction or such other reasonable assurance
that the endorsement or instruction is genuine and authorized as the Corporation may request;
(iv)
the transfer does not violate any restriction on transfer imposed by the Corporation that is enforceable in accordance with Section
7.8(a); and
(v)
such other conditions for such transfer as shall be provided for under applicable law have been satisfied.
(b)
Whenever any transfer of shares shall be made for collateral security and not absolutely, the Corporation shall so record such fact in
the entry of transfer if, when the certificate for such shares is presented to the Corporation for transfer or, if such shares are uncertificated,
when the instruction for registration of transfer thereof is presented to the Corporation, both the transferor and transferee request
the Corporation to do so.
Section
7.7 Registered Stockholders. Before due presentment for registration of transfer of a certificate representing shares of the Corporation
or of an instruction requesting registration of transfer of uncertificated shares, the Corporation may treat the registered owner as the
person exclusively entitled to inspect for any proper purpose the stock ledger and the other books and records of the Corporation, vote
such shares, receive dividends or notifications with respect to such shares and otherwise exercise all the rights and powers of the owner
of such shares, except that a person who is the beneficial owner of such shares (if held in a voting trust or by a nominee on behalf of
such person) may, upon providing documentary evidence of beneficial ownership of such shares and satisfying such other conditions as are
provided under applicable law, may also so inspect the books and records of the Corporation.
Section
7.8 Effect of the Corporation’s Restriction on Transfer.
(a)
A written restriction on the transfer or registration of transfer of shares of the Corporation or on the amount of shares of the Corporation
that may be owned by any person or group of persons, if permitted by the DGCL and noted conspicuously on the certificate representing
such shares or, in the case of uncertificated shares, contained in a notice, offering circular or prospectus sent by the Corporation to
the registered owner of such shares within a reasonable time prior to or after the issuance or transfer of such shares, may be enforced
against the holder of such shares or any successor or transferee of the holder including an executor, administrator, trustee, guardian
or other fiduciary entrusted with like responsibility for the person or estate of the holder.
(b)
A restriction imposed by the Corporation on the transfer or the registration of shares of the Corporation or on the amount of shares of
the Corporation that may be owned by any person or group of persons, even if otherwise lawful, is ineffective against a person without
actual knowledge of such restriction unless: (i) the shares are certificated and such restriction is noted conspicuously on the certificate;
or (ii) the shares are uncertificated and such restriction was contained in a notice, offering circular or prospectus sent by the Corporation
to the registered owner of such shares prior to or within a reasonable time after the issuance or transfer of such shares.
Section
7.9 Regulations. The Board shall have power and authority to make such additional rules and regulations, subject to any applicable
requirement of law, as the Board may deem necessary and appropriate with respect to the issue, transfer or registration of transfer of
shares of stock or certificates representing shares. The Board may appoint one or more transfer agents or registrars and may require for
the validity thereof that certificates representing shares bear the signature of any transfer agent or registrar so appointed.
ARTICLE
VIII
INDEMNIFICATION
Section
8.1 Right to Indemnification. To the fullest extent permitted by applicable law, as the same exists or may hereafter be amended, the
Corporation shall indemnify and hold harmless each person who was or is made a party or is threatened to be made a party to or is otherwise
involved in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative
(hereinafter a “proceeding”), by reason of the fact that he or she is or was a director or officer of the Corporation
or, while a director or officer of the Corporation, is or was serving at the request of the Corporation as a director, officer, employee
or agent of another corporation or of a partnership, joint venture, trust, other enterprise or nonprofit entity, including service with
respect to an employee benefit plan (hereinafter an “Indemnitee”), whether the basis of such proceeding is alleged
action in an official capacity as a director, officer, employee or agent, or in any other capacity while serving as a director, officer,
employee or agent, against all liability and loss suffered and expenses (including, without limitation, attorneys’ fees, judgments,
fines, ERISA excise taxes and penalties and amounts paid in settlement) reasonably incurred by such Indemnitee in connection with such
proceeding; provided, however, that, except as provided in Section 8.3 with respect to proceedings
to enforce rights to indemnification, the Corporation shall indemnify an Indemnitee in connection with a proceeding (or part thereof)
initiated by such Indemnitee only if such proceeding (or part thereof) was authorized by the Board.
Section
8.2 Right to Advancement of Expenses. In addition to the right to indemnification conferred in Section 8.1, an Indemnitee
shall also have the right to be paid by the Corporation to the fullest extent not prohibited by applicable law the expenses (including,
without limitation, attorneys’ fees) incurred in defending or otherwise participating in any such proceeding in advance of its final
disposition (hereinafter an “advancement of expenses”); provided, however, that, if
the DGCL requires, an advancement of expenses incurred by an Indemnitee in his or her capacity as a director or officer of the Corporation
(and not in any other capacity in which service was or is rendered by such Indemnitee, including, without limitation, service to an employee
benefit plan) shall be made only upon the Corporation’s receipt of an undertaking (hereinafter an “undertaking”),
by or on behalf of such Indemnitee, to repay all amounts so advanced if it shall ultimately be determined that such Indemnitee is not
entitled to be indemnified under this Article VIII or otherwise.
Section
8.3 Right of Indemnitee to Bring Suit. If a claim under Section 8.1 or Section 8.2 is not paid in
full by the Corporation within 60 days after a written claim therefor has been received by the Corporation, except in the case of a claim
for an advancement of expenses, in which case the applicable period shall be 20 days, the Indemnitee may at any time thereafter bring
suit against the Corporation to recover the unpaid amount of the claim. If successful in whole or in part in any such suit, or in a suit
brought by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the Indemnitee shall also be
entitled to be paid the expense of prosecuting or defending such suit. In (a) any suit brought by the Indemnitee to enforce a right to
indemnification hereunder (but not in a suit brought by an Indemnitee to enforce a right to an advancement of expenses) it shall be a
defense that, and (b) in any suit brought by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking,
the Corporation shall be entitled to recover such expenses upon a final judicial decision from which there is no further right to appeal
(hereinafter a “final adjudication”) that, the Indemnitee has not met any applicable standard for indemnification
set forth in the DGCL. Neither the failure of the Corporation (including its directors who are not parties to such action, a committee
of such directors, independent legal counsel, or its stockholders) to have made a determination prior to the commencement of such suit
that indemnification of the Indemnitee is proper in the circumstances because the Indemnitee has met the applicable standard of conduct
set forth in the DGCL, nor an actual determination by the Corporation (including a determination by its directors who are not parties
to such action, a committee of such directors, independent legal counsel, or its stockholders) that the Indemnitee has not met such applicable
standard of conduct, shall create a presumption that the Indemnitee has not met the applicable standard of conduct or, in the case of
such a suit brought by the Indemnitee, shall be a defense to such suit. In any suit brought by the Indemnitee to enforce a right to indemnification
or to an advancement of expenses hereunder, or by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking,
the burden of proving that the Indemnitee is not entitled to be indemnified, or to such advancement of expenses, under this Article
VIII or otherwise shall be on the Corporation.
Section
8.4 Non-Exclusivity of Rights. The rights provided to any Indemnitee pursuant to this Article VIII shall not be exclusive
of any other right, which such Indemnitee may have or hereafter acquire under applicable law, the Certificate of Incorporation, these
Bylaws, an agreement, a vote of stockholders or disinterested directors, or otherwise.
Section
8.5 Insurance. The Corporation may maintain insurance, at its expense, to protect itself and/or any director, officer, employee or
agent of the Corporation or another corporation, partnership, joint venture, trust or other enterprise against any expense, liability
or loss, whether or not the Corporation would have the power to indemnify such person against such expense, liability or loss under the
DGCL.
Section
8.6 Indemnification of Other Persons. This Article VIII shall not limit the right of the Corporation to the extent
and in the manner authorized or permitted by law to indemnify and to advance expenses to persons other than Indemnitees. Without limiting
the foregoing, the Corporation may, to the extent authorized from time to time by the Board, grant rights to indemnification and to the
advancement of expenses to any employee or agent of the Corporation and to any other person who is or was serving at the request of the
Corporation as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust or other enterprise,
including service with respect to an employee benefit plan, to the fullest extent of the provisions of this Article VIII with
respect to the indemnification and advancement of expenses of Indemnitees under this Article VIII.
Section
8.7 Amendments. Any repeal or amendment of this Article VIII by the Board or the stockholders of the Corporation
or by changes in applicable law, or the adoption of any other provision of these Bylaws inconsistent with this Article VIII,
will, to the extent permitted by applicable law, be prospective only (except to the extent such amendment or change in applicable law
permits the Corporation to provide broader indemnification rights to Indemnitees on a retroactive basis than permitted prior thereto),
and will not in any way diminish or adversely affect any right or protection existing hereunder in respect of any act or omission occurring
prior to such repeal or amendment or adoption of such inconsistent provision; provided, however, that amendments
or repeals of this Article VIII shall require the affirmative vote of the stockholders holding at least 66.7% of the
voting power of all outstanding shares of capital stock of the Corporation.
Section
8.8 Certain Definitions. For purposes of this Article VIII, (a) references to “other enterprise”
shall include any employee benefit plan; (b) references to “fines” shall include any excise taxes assessed on
a person with respect to an employee benefit plan; (c) references to “serving at the request of the Corporation”
shall include any service that imposes duties on, or involves services by, a person with respect to any employee benefit plan, its participants,
or beneficiaries; and (d) 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 interest
of the Corporation” for purposes of Section 145 of the DGCL.
Section
8.9 Contract Rights. The rights provided to Indemnitees pursuant to this Article VIII shall be contract rights and
such rights shall continue as to an Indemnitee who has ceased to be a director, officer, agent or employee and shall inure to the benefit
of the Indemnitee’s heirs, executors and administrators.
Section
8.10 Severability. If any provision or provisions of this Article VIII shall be held to be invalid, illegal or unenforceable
for any reason whatsoever: (a) the validity, legality and enforceability of the remaining provisions of this Article VIII shall
not in any way be affected or impaired thereby; and (b) to the fullest extent possible, the provisions of this Article VIII (including,
without limitation, each such portion of this Article VIII containing any such provision held to be invalid, illegal
or unenforceable) shall be construed so as to give effect to the intent manifested by the provision held invalid, illegal or unenforceable.
ARTICLE
IX
MISCELLANEOUS
Section
9.1 Place of Meetings. If the place of any meeting of stockholders, the Board or committee of the Board for which notice is required
under these Bylaws is not designated in the notice of such meeting, such meeting shall be held at the principal business office of the
Corporation; provided, however, if the Board has, in its sole discretion, determined that a meeting shall not
be held at any place, but instead shall be held by means of remote communication pursuant to Section 9.5 hereof, then
such meeting shall not be held at any place.
Section
9.2 Fixing Record Dates.
(a)
In order that the Corporation may determine the stockholders entitled to notice of any meeting of stockholders or any adjournment thereof,
the Board may fix a record date, which shall not precede the date upon which the resolution fixing the record date is adopted by the Board,
and which record date shall not be more than 60 nor less than 10 days before the date of such meeting. If the Board so fixes a date, such
date shall also be the record date for determining the stockholders entitled to vote at such meeting unless the Board determines, at the
time it fixes such record date, that a later date on or before the date of the meeting shall be the date for making such determination.
If no record date is fixed by the Board, the record date for determining stockholders entitled to notice of and to vote at a meeting of
stockholders shall be at the close of business on the business day next preceding the day on which notice is given, or, if notice is waived,
at the close of business on the business day next preceding the day on which the meeting is held. A determination of stockholders of record
entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however,
that the Board may fix a new record date for the adjourned meeting, and in such case shall also fix as the record date for stockholders
entitled to notice of such adjourned meeting the same or an earlier date as that fixed for determination of stockholders entitled to vote
in accordance with the foregoing provisions of this Section 9.2(a) at the adjourned meeting.
(b)
In order that the Corporation may determine the stockholders entitled to receive payment of any dividend or other distribution or allotment
of any rights or the stockholders entitled to exercise any rights in respect of any change, conversion or exchange of stock, or for the
purpose of any other lawful action, the Board may fix a record date, which record date shall not precede the date upon which the resolution
fixing the record date is adopted, and which record date shall be not more than 60 days prior to such action. If no record date is fixed,
the record date for determining stockholders for any such purpose shall be at the close of business on the day on which the Board adopts
the resolution relating thereto.
Section
9.3 Notice.
(a) Notice
to Directors. Whenever under applicable law, the Certificate of Incorporation or these Bylaws notice is required to be given to any
director, such notice shall be given either (i) in writing and sent by mail, or by a nationally recognized delivery service, (ii) by means
of facsimile telecommunication or other form of electronic transmission, or (iii) by oral notice given personally or by telephone. A notice
to a director will be deemed given as follows: (i) if given by hand delivery, orally, or by telephone, when actually received by the director,
(ii) if sent through the United States mail, when deposited in the United States mail, with postage and fees thereon prepaid, addressed
to the director at the director’s address appearing on the records of the Corporation, (iii) if sent for next day delivery by a
nationally recognized overnight delivery service, when deposited with such service, with fees thereon prepaid, addressed to the director
at the director’s address appearing on the records of the Corporation, (iv) if sent by facsimile telecommunication, when sent
to the facsimile transmission number for such director appearing on the records of the Corporation, (v) if sent by electronic mail, when
sent to the electronic mail address for such director appearing on the records of the Corporation, or (vi) if sent by any other form of
electronic transmission, when sent to the address, location or number (as applicable) for such director appearing on the records of the
Corporation.
(b) Notice
to Stockholders. Whenever under applicable law, the Certificate of Incorporation or these Bylaws notice is required to be given to
any stockholder, such notice may be given (i) in writing and sent either by hand delivery, through the United States mail, or by a nationally
recognized overnight delivery service for next day delivery, or (ii) by means of a form of electronic transmission consented to by
the stockholder, to the extent permitted by, and subject to the conditions set forth in Section 232 of the DGCL. A notice to a stockholder
shall be deemed given as follows: (i) if given by hand delivery, when actually received by the stockholder, (ii) if sent through the United
States mail, when deposited in the United States mail, with postage and fees thereon prepaid, addressed to the stockholder at the stockholder’s
address appearing on the stock ledger of the Corporation, (iii) if sent for next day delivery by a nationally recognized overnight delivery
service, when deposited with such service, with fees thereon prepaid, addressed to the stockholder at the stockholder’s address
appearing on the stock ledger of the Corporation, and (iv) if given by a form of electronic transmission consented to by the stockholder
to whom the notice is given and otherwise meeting the requirements set forth above, (A) if by facsimile transmission, when directed to
a number at which the stockholder has consented to receive notice, (B) if by electronic mail, when directed to an electronic mail address
at which the stockholder has consented to receive notice, (C) if by a posting on an electronic network together with separate notice to
the stockholder of such specified posting, upon the later of (1) such posting and (2) the giving of such separate notice, and (D) if by
any other form of electronic transmission, when directed to the stockholder. A stockholder may revoke such stockholder’s consent
to receiving notice by means of electronic communication by giving written notice of such revocation to the Corporation. Any such consent
shall be deemed revoked if (1) the Corporation is unable to deliver by electronic transmission two consecutive notices given by the Corporation
in accordance with such consent and (2) such inability becomes known to the Secretary or an Assistant Secretary or to the Corporation’s
transfer agent, or other person responsible for the giving of notice; provided, however, the inadvertent failure
to treat such inability as a revocation shall not invalidate any meeting or other action.
(c) Electronic
Transmission. “Electronic transmission” means any form of communication, not directly involving the physical
transmission of paper, that creates a record that may be retained, retrieved and reviewed by a recipient thereof, and that may be directly
reproduced in paper form by such a recipient through an automated process, including but not limited to transmission by telex, facsimile
telecommunication, electronic mail, telegram and cablegram.
(d) Notice
to Stockholders Sharing Same Address. Without limiting the manner by which notice otherwise may be given effectively by the Corporation
to stockholders, any notice to stockholders given by the Corporation under any provision of the DGCL, the Certificate of Incorporation
or these Bylaws shall be effective if given by a single written notice to stockholders who share an address if consented to by the stockholders
at that address to whom such notice is given. A stockholder may revoke such stockholder’s consent by delivering written notice of
such revocation to the Corporation. Any stockholder who fails to object in writing to the Corporation within 60 days of having been given
written notice by the Corporation of its intention to send such a single written notice shall be deemed to have consented to receiving
such single written notice.
(e) Exceptions
to Notice Requirements. Whenever notice is required to be given, under the DGCL, the Certificate of Incorporation or these Bylaws,
to any person with whom communication is unlawful, the giving of such notice to such person shall not be required and there shall be no
duty to apply to any governmental authority or agency for a license or permit to give such notice to such person. Any action or meeting
that shall be taken or held without notice to any such person with whom communication is unlawful shall have the same force and effect
as if such notice had been duly given. In the event that the action taken by the Corporation is such as to require the filing of a certificate
with the Secretary of State of Delaware, the certificate shall state, if such is the fact and if notice is required, that notice was given
to all persons entitled to receive notice except such persons with whom communication is unlawful.
Whenever
notice is required to be given by the Corporation, under any provision of the DGCL, the Certificate of Incorporation or these Bylaws,
to any stockholder to whom (1) notice of two consecutive annual meetings of stockholders and all notices of stockholder meetings or of
the taking of action by written consent of stockholders without a meeting to such stockholder during the period between such two consecutive
annual meetings, or (2) all, and at least two payments (if sent by first-class mail) of dividends or interest on securities during a 12-month
period, have been mailed addressed to such stockholder at such stockholder’s address as shown on the records of the Corporation
and have been returned undeliverable, the giving of such notice to such stockholder shall not be required. Any action or meeting that
shall be taken or held without notice to such stockholder shall have the same force and effect as if such notice had been duly given.
If any such stockholder shall deliver to the Corporation a written notice setting forth such stockholder’s then current address,
the requirement that notice be given to such stockholder shall be reinstated. In the event that the action taken by the Corporation is
such as to require the filing of a certificate with the Secretary of State of Delaware, the certificate need not state that notice was
not given to persons to whom notice was not required to be given pursuant to Section 230(b) of the DGCL. The exception in subsection (1)
of the first sentence of this paragraph to the requirement that notice be given shall not be applicable to any notice returned as undeliverable
if the notice was given by electronic transmission.
Section
9.4 Waiver of Notice. Whenever any notice is required to be given under applicable law, the Certificate of Incorporation, or these
Bylaws, a written waiver of such notice, signed before or after the date of such meeting by the person or persons entitled to said notice,
or a waiver by electronic transmission by the person entitled to said notice, shall be deemed equivalent to such required notice. All
such waivers shall be kept with the books of the Corporation. Attendance at a meeting shall constitute a waiver of notice of such meeting,
except where a person attends for the express purpose of objecting to the transaction of any business on the ground that the meeting was
not lawfully called or convened.
Section
9.5 Meeting Attendance via Remote Communication Equipment.
(a) Stockholder
Meetings. If authorized by the Board in its sole discretion, and subject to such guidelines and procedures as the Board may adopt,
stockholders entitled to vote at such meeting and proxy holders not physically present at a meeting of stockholders may, by means of remote
communication:
(i)
participate in a meeting of stockholders; and
(ii)
be deemed present in person and vote at a meeting of stockholders, whether such meeting is to be held at a designated place or solely
by means of remote communication; provided, that (A) the Corporation shall implement reasonable measures to verify that each
person deemed present and permitted to vote at the meeting by means of remote communication is a stockholder or proxy holder, (B) the
Corporation shall implement reasonable measures to provide such stockholders and proxy holders a reasonable opportunity to participate
in the meeting and, if entitled to vote, to vote on matters submitted to the applicable stockholders, including an opportunity to read
or hear the proceedings of the meeting substantially concurrently with such proceedings, and (C) if any stockholder or proxy holder votes
or takes other action at the meeting by means of remote communication, a record of such votes or other action shall be maintained by the
Corporation.
(b) Board
Meetings. Unless otherwise restricted by applicable law, the Certificate of Incorporation or these Bylaws, members of the Board or
any committee thereof may participate in a meeting of the Board or any committee thereof by means of conference telephone or other communications
equipment by means of which all persons participating in the meeting can hear each other. Such participation in a meeting shall constitute
presence in person at the meeting, except where a person participates in the meeting for the express purpose of objecting to the transaction
of any business on the ground that the meeting was not lawfully called or convened.
Section
9.6 Dividends. The Board may from time to time declare, and the Corporation may pay, dividends (payable in cash, property or shares
of the Corporation’s capital stock) on the Corporation’s outstanding shares of capital stock, subject to applicable law and
the Certificate of Incorporation.
Section
9.7 Reserves. The Board may set apart out of the funds of the Corporation available for dividends a reserve or reserves for any proper
purpose and may abolish any such reserve.
Section
9.8 Contracts and Negotiable Instruments. Except as otherwise provided by applicable law, the Certificate of Incorporation or these
Bylaws, any contract, bond, deed, lease, mortgage or other instrument may be executed and delivered in the name and on behalf of the Corporation
by such officer or officers or other employee or employees of the Corporation as the Board may from time to time authorize. Such authority
may be general or confined to specific instances as the Board may determine. The Chairman of the Board, the Chief Executive Officer, the
President, the Chief Financial Officer, the Treasurer or any Vice President may execute and deliver any contract, bond, deed, lease, mortgage
or other instrument in the name and on behalf of the Corporation. Subject to any restrictions imposed by the Board, the Chairman of the
Board Chief Executive Officer, President, the Chief Financial Officer, the Treasurer or any Vice President may delegate powers to execute
and deliver any contract, bond, deed, lease, mortgage or other instrument in the name and on behalf of the Corporation to other officers
or employees of the Corporation under such person’s supervision and authority, it being understood, however, that any such delegation
of power shall not relieve such officer of responsibility with respect to the exercise of such delegated power.
Section
9.9 Fiscal Year. The fiscal year of the Corporation shall be fixed by the Board.
Section
9.10 Seal. The Board may adopt a corporate seal, which shall be in such form as the Board determines. The seal may be used by causing
it or a facsimile thereof to be impressed, affixed or otherwise reproduced.
Section
9.11 Books and Records. The books and records of the Corporation may be kept within or outside the State of Delaware at such place
or places as may from time to time be designated by the Board.
Section
9.12 Resignation. Any director, committee member or officer may resign by giving notice thereof in writing or by electronic transmission
to the Chairman of the Board, the Chief Executive Officer, the President or the Secretary. The resignation shall take effect at the time
specified therein, or at the time of receipt of such notice if no time is specified or the specified time is earlier than the time of
such receipt. Unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective.
Section
9.13 Surety Bonds. Such officers, employees and agents of the Corporation (if any) as the Chairman of the Board, Chief Executive Officer,
President or the Board may direct, from time to time, shall be bonded for the faithful performance of their duties and for the restoration
to the Corporation, in case of their death, resignation, retirement, disqualification or removal from office, of all books, papers, vouchers,
money and other property of whatever kind in their possession or under their control belonging to the Corporation, in such amounts and
by such surety companies as the Chairman of the Board, Chief Executive Officer, President or the Board may determine. The premiums on
such bonds shall be paid by the Corporation and the bonds so furnished shall be in the custody of the Secretary.
Section
9.14 Securities of Other Corporations. Powers of attorney, proxies, waivers of notice of meeting, consents in writing and other instruments
relating to securities owned by the Corporation may be executed in the name of and on behalf of the Corporation by the Chairman of the
Board, Chief Executive Officer, President, any Vice President or any officers authorized by the Board. Any such officer, may, in the name
of and on behalf of the Corporation, take all such action as any such officer may deem advisable to vote in person or by proxy at any
meeting of security holders of any corporation in which the Corporation may own securities, or to consent in writing, in the name of the
Corporation as such holder, to any action by such corporation, and at any such meeting or with respect to any such consent shall possess
and may exercise any and all rights and power incident to the ownership of such securities and which, as the owner thereof, the Corporation
might have exercised and possessed. The Board may from time to time confer like powers upon any other person or persons.
Section
9.15 Amendments. In furtherance and not in limitation of the powers conferred upon it by law, the Board is expressly authorized to
adopt, amend, alter or repeal the Bylaws. The Bylaws also may be adopted, amended, altered or repealed by the stockholders of the Corporation; provided, however,
that in addition to any vote of the holders of any class or series of capital stock of the Corporation required by law or by the Certificate
of Incorporation, the affirmative vote of the holders of at least a majority of the voting power of all then outstanding shares of capital
stock of the Corporation entitled to vote generally in the election of directors, voting together as a single class, shall be required
for the stockholders of the Corporation to adopt, amend, alter or repeal the Bylaws; and provided, further, however,
that no Bylaws hereafter adopted by the stockholders of the Corporation shall invalidate any prior act of the Board that would have been
valid if such Bylaws had not been adopted.
Exhibit
I
FORM OF
VOTING AGREEMENT
This
Voting Agreement (this “Agreement”) is made as of [__], 2022, by and among DataLogiq, Inc. (f/k/a Abri SPAC
I, Inc.), a Delaware corporation (the “Parent”), Abri Ventures I, LLC (the “Sponsor”),
and each of the individuals and entities set forth on the signature page hereto (each a “Voting Party” and collectively,
the “Voting Parties”). For purposes of this Agreement, capitalized terms used and not defined herein shall have
the respective meanings ascribed to them in the Merger Agreement (as defined below). This Agreement shall be effective as of the Closing
Date of the Merger.
RECITALS
WHEREAS,
Parent, Abri Merger Sub, Inc., a Delaware corporation, DLQ, Inc., a Nevada corporation (the “Company”), and
Logiq, Inc., the parent of DLQ, Inc. have entered into that certain Merger Agreement (as may be amended from time to time, the “Merger
Agreement”), dated as of September 9, 2022;
WHEREAS,
each of the Voting Parties, currently owns, or on the closing of the transactions contemplated by the Merger Agreement, will own, shares
of Parent’s common stock, and wishes to provide for orderly elections of Parent’s Board of Directors after the Closing Date
(the “Post-Closing Board of Directors”) as described herein; and
WHEREAS,
as of the Effective Time, three directors, each designated by Sponsor, have been elected to the Post-Closing Board of Directors.
NOW
THEREFORE, in consideration of the foregoing and of the promises and covenants contained herein, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:
AGREEMENT
1.
Agreement to Vote. During the term of this Agreement, each Voting Party agrees to vote all shares of capital stock of Parent that
such Voting Party owns from time to time and are entitled to vote (hereinafter referred to as the “Voting Shares”)
in the election of the Post-Closing Board of Directors, in accordance with the provisions of this Agreement, whether at a regular or special
meeting of stockholders or by written consent.
2.
Election of Boards of Directors.
2.1
Voting; Initial Designees. During the term of this Agreement, each Voting Party agrees to vote all Voting Shares for the election
as members of the Post-Closing Board of Directors of each nominee designated by the Sponsor at each regular or special meeting of Parent
stockholders where such nominee stands for such election at such meeting. The Sponsor’s initial designees to the Post-Closing Board
of Directors are [________][ ], and [________].
2.2
Size of the Board. During the term of this Agreement, the parties hereto agree that they shall, and shall cause their respective successors
to, maintain the size of the Post-Closing Board of Directors at five (5) directors.
2.3
Number of Designees; Notice to Parent.
(a)
Prior to the termination of this Agreement, for so long as the Sponsor and/or its Affiliates, either individually or as a group (as such
term is construed in accordance with the Exchange Act), beneficially own at least fifty percent (50%) of the Closing Sponsor Shares (as
defined below), Parent shall include in the slate of nominees recommended by the Post-Closing Board of Directors for election as directors
at each applicable annual or special meeting of the stockholders of Parent at which directors are to be elected, each of the three (3)
individuals designated by the Sponsor; provided, however, that:
(i)
from and after the date on which Sponsor and/or its Affiliates cease to hold at least fifty percent (50%) of the Closing Sponsor Shares
(a “50% Reduction”), the number of nominees designated by Sponsor that Parent is required to recommend for election
at any subsequent annual or special meeting of the stockholders of Parent at which directors are to be elected pursuant to this Section
2.3(a) shall be reduced to two (2); and
(ii)
from and after the date on which Sponsor and/or its Affiliates cease to hold at least twenty-five percent (25%) of the Closing Sponsor
Shares (a “75% Reduction”), Parent shall have no obligation to recommend any nominees designated by Sponsor
for election at any subsequent annual or special meeting of the stockholders of Parent at which directors are to be elected.
(b)
No less than five (5) Business Days following the Closing, Sponsor shall provide written notice to Parent specifying the number of shares
of capital stock of Parent held by Sponsor and/or its Affiliates individually or as a group (as such term is construed in accordance with
the Exchange Act) as of the Effective Time, including any shares of capital stock of Parent that Sponsor and/or its Affiliates are entitled
to receive as Merger Consideration in connection with the consummation of the Merger (the “Closing Sponsor Shares”).
(c)
No less than five (5) Business Days after the occurrence of a 50% Reduction and a 75% Reduction, as applicable, Sponsor shall provide
written notice thereof to Parent, which notice shall set forth, if delivered solely with respect to a 50% Reduction, the name of the Sponsor
Designee (as defined below) to be removed from the Post-Closing Board of Directors pursuant to Section 2.5(a).
2.4
Advance Resignation Letters. Parent may require, prior to or at any time after becoming a member of the Post-Closing Board of Directors,
each designee of Sponsor elected to the Post-Closing Board of Directors (each, as may be replaced from time to time, a “Sponsor
Designee”) to execute and deliver an undated resignation letter (each, a “Resignation Letter”)
to the Secretary of Parent, which Parent agrees shall not be dated or become effective until such time as such Sponsor Designee’s
resignation is required pursuant to Section 2.5(a).
2.5
Removal of Directors; Obligations; Vacancies.
(a)
Sponsor hereby acknowledges and agrees that, upon the occurrence of: (i) a 50% Reduction, Parent may effect the resignation of the Sponsor
Designee specified in the notice given by Sponsor pursuant to Section 2.3(c); (ii) a 75% Reduction, Parent may effect the resignation
of the final Sponsor Designee; and (iii) both a 50% Reduction and a 75% Reduction, simultaneously, Parent may effect the resignation of
both Sponsor Designees, in each case pursuant to the dating of the applicable Resignation Letter of such Sponsor Designee as of the date
of the 50% Reduction or the 75% Reduction, as applicable, with such resignation deemed to have occurred, and being effective as of, such
date. In the event Sponsor does not deliver the notice required pursuant to Section 2.3(b) by the date that is five (5) Business Days
after the occurrence of a 50% Reduction or a 75% Reduction, as applicable, Parent has the right, upon otherwise becoming aware of the
occurrence of a 50% Reduction or a 75% Reduction, to take the actions specified in the immediately preceding sentence and, in the case
of a 50% Reduction only, may effect the resignation of a Sponsor Designee determined by Parent in its sole discretion.
(b)
The obligations of the Voting Parties pursuant to this Section 2 shall include any stockholder vote to amend Parent’s amended and
restated certificate of incorporation as required to effect the intent of this Agreement. Each of Sponsor, the Voting Parties and Parent
agree to take all actions required to ensure that the rights given to each Voting Party and Sponsor hereunder are effective and that each
Voting Party and Sponsor enjoys the benefits thereof. Each of Sponsor, the Voting Parties and Parent further agree not to take any actions
that would contravene or materially and adversely affect the provisions of this Agreement and the intention of the parties with respect
to the composition of the Post-Closing Board of Directors as herein stated. The parties acknowledge that the fiduciary duties of each
member of the Post-Closing Board of Directors are to Parent’s stockholders as a whole.
(c)
In the event any director elected pursuant to the terms hereof ceases to serve as a member of the Post-Closing Board of Directors, except
for as the result of any 50% Reduction or 75% Reduction, Parent, the Sponsor and the Voting Parties agree to vote the Voting Shares for
the election or appointment of such other person designated by the Sponsor to the Post-Closing Board of Directors in accordance with the
terms provided herein (each such Person, a “Replacement Designee”); provided, however, that
any Replacement Designee must (i) be reasonably acceptable to the Post-Closing Board of Directors (such acceptance not to be unreasonably
withheld), (ii) qualify as “independent” pursuant to NASDAQ listing standards, (iii) have the relevant financial and business
experience to be a director of Parent, and (iv) satisfy the publicly disclosed guidelines and policies of Parent with respect to service
on the Post-Closing Board of Directors. In the event any Replacement Designee does not satisfy one or more of the requirements set forth
in clauses (i) through (iv) above, Sponsor shall have the right to recommend additional Replacement Designees whose appointment shall
be subject to approval in accordance with the procedures described in this Section 2.5(c).
3.
Representations and Warranties of the Sponsor and the Voting Parties. Each Voting Party and the Sponsor hereby represents and warrants
to Parent as follows:
3.1 Organization
and Power. Such Person is duly organized, validly existing, and in good standing under the laws of the jurisdiction of its formation
and has all requisite power and authority to carry on its business as presently conducted and as proposed to be conducted.
3.2 Authorization.
Such Person has full power and authority to enter into this Agreement. This Agreement, when executed and delivered by such Person, shall
constitute the valid and legally binding obligation of such Person, enforceable in accordance with its terms, except: (i) as limited
by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance and any other laws of general application affecting
enforcement of creditors’ rights generally; or (ii) as limited by laws relating to the availability of specific performance, injunctive
relief or other equitable remedies.
3.3 Governmental
Consents and Filings. No consent, approval, order or authorization of, or registration, qualification, designation, declaration or
filing with, any federal, state or local governmental authority is required on the part of such Person in connection with the consummation
of the transactions contemplated by this Agreement.
3.4 Compliance
with Other Instruments. The execution, delivery and performance by such Person of this Agreement and the consummation by such Person
of the transactions contemplated by this Agreement will not result in any violation or default: (a) of any provisions of its organizational
documents, if applicable; (b) of any instrument, judgment, order, writ or decree to which it is a party or by which it is bound; (c) under
any note, indenture or mortgage to which it is a party or by which it is bound; (d) under any lease, agreement, contract or purchase order
to which it is a party or by which it is bound; or (e) of any provision of any federal or state statute, rule or regulation applicable
to such Person, in each case (other than clause (a)), which would have a material adverse effect on such Person or its ability to consummate
the transactions contemplated by this Agreement.
4. Successors
in Interest of the Voting Parties and Parent. The provisions of this Agreement shall be binding upon the successors in interest of
any Voting Party with respect to any of such Voting Party’s Voting Shares or any voting rights therein, unless (i) the Voting Shares
are sold on Nasdaq or any other national securities exchange or (ii) with respect to Logiq, Inc., such Voting Shares are the Dividend
Shares. Each Voting Party shall not, and Parent shall not, permit the transfer of any Voting Party’s Voting Shares (except for sales
of Voting Shares on Nasdaq or any other national securities exchange), unless and until the person to whom such securities are to be transferred
shall have executed a written agreement pursuant to which such person agrees to become a party to this Agreement and agrees to be bound
by all the provisions hereof as if such person was a Voting Party hereunder. Notwithstanding the foregoing, the Parties hereto agree and
acknowledge that each of the Voting Parties has entered into a Company Lock-Up Agreement and has agreed not to transfer any of the Voting
Party’s Voting Shares except in accordance with the Company Lock-Up Agreement.
5.
Public Listing. During the term of this Agreement, Parent shall take all reasonable efforts for Parent to remain listed as a public
company on, and for the common stock of Parent to be tradable over, Nasdaq.
6.
Grant of Proxy. The parties agree that this Agreement does not constitute the granting of a proxy to any party or any other person; provided, however,
that should the provisions of this Agreement be construed to constitute the granting of proxies, such proxies shall be deemed coupled
with an interest and are irrevocable for the term of this Agreement.
7.
Specific Enforcement. It is agreed and understood that monetary damages would not adequately compensate an injured party for the breach
of this Agreement by any party hereto, that this Agreement shall be specifically enforceable, and that any breach of this Agreement shall
be the proper subject of a temporary or permanent injunction or restraining order. Further, each party hereto waives any claim or defense
that there is an adequate remedy at Law for such breach or threatened breach and agrees that a party’s rights would be materially
and adversely affected if the obligations of the other parties under this Agreement were not carried out in accordance with the terms
and conditions hereof.
8.
Manner of Voting. The voting of the Voting Shares pursuant to this Agreement may be effected in person, by proxy, by written consent
or in any other manner permitted by applicable Law.
9.
Termination. This Agreement shall terminate automatically (without any action by any party) upon the earlier to occur of (a) the date
that is the second (2nd) anniversary of the date hereof and (b) the occurrence of a 75% Reduction, and thereafter shall immediately
become void and have no further force or effect, and no party hereto will have any further obligation or liability to any other party; provided, however,
that no such termination will relieve either party from liability for any breach of this Agreement by such party prior to such termination.
10.
Amendments and Waivers. Except as otherwise provided herein, any provision of this Agreement may be amended or the observance thereof
may be waived (either generally or in a particular instance and either retroactively or prospectively) only with the unanimous written
consent of (a) Parent, and (b) the holders of a majority of Voting Shares then held by the Voting Parties.
11.
Stock Splits, Stock Dividends, etc. In the event of any stock split, stock dividend, recapitalization, reorganization or the like,
(a) any securities issued with respect to Voting Shares held by Voting Parties shall become Voting Shares for purposes of this Agreement
and (b) the Closing Sponsor Shares shall be appropriately adjusted on a pro rata basis and consistent with the terms of this Agreement.
12.
Severability. A determination by a court or other legal authority that any provision that is not of the essence of this Agreement
is legally invalid shall not affect the validity or enforceability of any other provision hereof. The parties shall cooperate in good
faith to substitute (or cause such court or other legal authority to substitute) for any provision so held to be invalid a valid provision,
as alike in substance to such invalid provision as is lawful.
13.
Governing Law. This Agreement and all disputes or controversies arising out of or relating to this Agreement, including the applicable
statute of limitations, shall be governed by and interpreted in accordance with the Laws of the State of Delaware, without giving effect
to any choice of law or conflict of law provision or rule (whether of the State of Delaware or any other jurisdiction) that would cause
the application of the Law of any jurisdiction other than the State of Delaware.
14.
Counterparts; Electronic Signatures. This Agreement may be executed in counterparts, each of which shall constitute an original, but
all of which shall constitute one agreement. This Agreement shall become effective upon delivery to each party of an executed counterpart
or the earlier delivery to each party of original, photocopied, or electronically transmitted signature pages that together (but need
not individually) bear the signatures of all other parties.
15.
Successors and Assigns. Except as otherwise expressly provided in this Agreement, the provisions hereof shall inure to the benefit
of, and be binding upon, the successors and assigns of the parties hereto.
16.
Entire Agreement. This Agreement constitutes the full and entire understanding and agreement among the parties, and supersedes any
prior agreement or understanding among the parties, with regard to the subjects hereof and thereof, and no party shall be liable or bound
to any other party in any manner by any warranties, representations or covenants except as specifically set forth herein or therein.
[Remainder of page
intentionally left blank; signature page follows]
This Agreement is hereby
executed effective as of the date first set forth above.
| |
|
Parent: |
| |
|
|
| |
|
DATALOGIQ, INC. |
| |
|
|
| |
|
By: |
|
|
| |
|
Name: |
|
|
| |
|
Title: |
|
|
| |
|
|
|
|
| |
|
Sponsor: |
| |
|
|
| |
|
ABRI VENTURES I, LLC |
| |
|
|
| |
|
By: |
|
|
| |
|
Name: |
|
|
| |
|
Title: |
|
|
| |
|
|
|
|
| |
|
Voting Parties: |
| |
|
|
| |
|
[To be provided.] |
[Signature Page to Voting
Agreement]
Annex C-22
Annex D
Feinstein Law, P.C.
Attorney at Law
| Todd S. Feinstein |
|
|
| Admitted WA & FL |
1710 Doe Run Rd |
|
| |
Sequim, Washington 98382 |
|
| |
(619)990-7491 |
|
| |
Todd@feinsteinlawfirm.com |
|
August 28, 2023
Logiq, Inc.
85 Broad Street, 16-079
New York, New York 10004
Attention: Brent Suen
Email: brent@logiq.com
Re: Merger Agreement dated as of September
9, 2022 by and among Logiq, Inc. (a Delaware corporation), DLQ, Inc. (a Nevada corporation), ABRI SPAC I, Inc., and ABRI Merger Sub, Inc.
(the “Agreement”)
Ladies and Gentlemen:
We have acted as United States
federal income tax counsel to Logiq, Inc., a Delaware corporation (the “Company”), in connection with the transactions
contemplated by the Agreement and in the ABRI SPAC I Inc. Registration Statement on Form S-4 filed on June 20, 2023 with
the Securities and Exchange Commission, as amended and supplemented through the date hereof (the “Registration Statement”).
This opinion letter is provided pursuant to the requirements of Section 3.1.9 of the Agreement. Unless otherwise
stated herein, initial capitalized terms used herein have the meanings assigned to them in the Registration Statement.
In connection with rendering
this opinion, we have examined and are relying upon (without any independent investigation or review of any factual statements therein)
the truth and accuracy, at all relevant times, of the statements, covenants, representations and warranties contained in the following
documents (including all exhibits and schedules attached thereto):
| 2. | the Registration Statement. |
Items 1 – 2 are collectively
hereinafter referred to as the “Transaction Documents.”
In reaching the opinions
set forth below, we have assumed, without any independent investigation or review, the following:
| 1. | The documents submitted to us as originals are authentic, accurate, and complete, and the documents submitted
to us as copies conform to the original documents, and all public records reviewed are accurate and complete; |
| 2. | Each of the parties to the Transaction Documents is validly existing and in good standing under the laws
of the jurisdiction governing its organization; |
| 3. | Each of the parties to the Transaction Documents has duly and validly executed and delivered the Transaction
Documents to which it is a signatory and each instrument, document, and agreement to be executed in connection with the Business Combination
to which such party is a signatory, and such party’s obligations set forth in the Transaction Documents (and each such instrument,
document, and agreement executed in connection with the Business Combination) are its valid, legal, and binding obligations, enforceable
in accordance with their respective terms; |
| 4. | Each person executing the Transaction Documents, whether individually or on behalf of an entity, is duly
authorized to do so; |
| 5. | All signatures on the Transaction Documents are genuine; |
| 6. | Each of the parties to the Transaction Documents has all requisite power and authority under all applicable
laws, regulations, and governing documents to execute, deliver, and perform its obligations under the Transaction Documents to which it
is a party; and |
| 7. | All conditions precedent to the effectiveness of the Transaction Documents, other that the delivery of
this opinion, have been satisfied. |
In rendering this opinion,
we have also assumed, without any independent investigation or review, that: (i) the Business Combination will be consummated pursuant
to and in accordance with the provisions of the Agreement and as described in the Registration Statement (and no transaction or condition
described therein and affecting this opinion will be waived by any party to the Agreement); (ii) the representations and statements concerning
the Business Combination and any parties thereto set forth in the Transaction Documents are true, complete and correct, and will remain
true, complete and correct at all times up to and including the effective date of the Business Combination (the “Effective Date”)
and thereafter; (iii) any such representations or statements made in the Transaction Documents qualified by knowledge, intention,
belief or any other similar qualification are true, complete and correct, and will remain true, complete and correct at all times up to
and including the Effective Date and thereafter, in each case as if made without such qualification; (iv) the parties to the Business
Combination have complied with and, if applicable, will continue to comply with, their respective covenants and agreements contained in
the Agreement; and (v) the parties to the Business Combination will treat the Business Combination for United States federal income
tax purposes in a manner consistent with the opinion set forth below. If any of the above described assumptions are untrue for any reason,
or if the Business Combination is consummated in a manner that is different from the manner described in the Transaction Documents, our
opinion as expressed below may be adversely affected. We do not and will not assume, and we hereby disclaim, any obligation of any nature
whatsoever to provide future updates of any of the opinions or qualifications set forth in this opinion letter.
Based on our review of the
Transaction Documents, and subject to the assumptions, exceptions, limitations and qualifications set forth herein and in the Registration
Statement, the discussion set forth in the Registration Statement under the caption “Material U.S. Federal Income Tax
Consequences of the Business Combination to U.S. Holder of DLQ Common Stock.” insofar as it expresses conclusions
as to the application of United States federal income tax law, is our opinion as to the material United States federal income tax consequences
of the Business Combination to holders of shares of Logiq (DLQ) Common Stock.
The foregoing opinions are
limited by the following qualifications:
| 1. | These opinions are limited to the effect of the federal income tax laws of the United States of America,
and we have expressed no opinion as the laws of any jurisdiction other than the federal income tax laws of the United States of America.
We have not considered the effects of the transaction on stockholders of the Company under the income tax laws of the states in which
they reside, and we have not considered the effects on the transaction, if any, of sales and use taxes or any state and local taxes. |
| 2. | We express no opinion as to the federal income tax consequences of the exchange of the Company’s
common stock, or warrant to acquire common stock in the Company, by any individual who received or receives such shares as compensation
and holds such shares as of the Effective Time subject to any restriction related to employment. |
| 3. | Changes to the Internal Revenue Code of 1986, as amended (“Code”), regulations, rulings
thereunder, and changes by the courts and the interpretation of the authorities relied thereupon, may be applied retroactively, and may
affect the opinions expressed herein. |
| 4. | These opinions are limited to the matters expressly stated herein, and no opinion is implied or may be
inferred beyond the matters expressly stated. |
| 5. | This opinion letter is based solely upon the Code, the Treasury Regulations issued thereunder, published
administrative interpretations thereof, and the judicial decisions with respect thereto, all as of the date hereof (collectively, the
“Tax Laws”). No assurance can be given that the Tax Laws will not change, and we give no assurance that such changes
will not affect the opinions expressed by us. We assume no obligation to supplement this opinion letter or any of our opinions if any
applicable Tax Laws change after the date of this opinion letter, or if we become aware of any facts, circumstances, or events that might
change any of the opinions expressed in this opinion letter after the date of this opinion letter. Moreover, these opinions are not binding
on the Internal Revenue Service or a court considering the matters set forth in this opinion letter. Therefore, the Internal Revenue Service
may take a contrary position than that of our opinions, and a court considering the issues may hold contrary to such opinions. In addition,
our opinion is being delivered prior to the consummation of the Business Combination and therefore is prospective and dependent on future
events. |
We hereby consent to use
of this opinion as an exhibit to the Registration Statement and to the use of our name therein. In giving this consent, we do not admit
that we come within the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended or
the rules and regulations of the Securities Exchange Commission thereunder, nor do we admit that we are experts with respect to any part
of the Registration Statement within the meaning of the term “experts” as used in the Securities Act of 1933, as amended,
or the rules and regulations of the Securities and Exchange Commission thereunder.
| Sincerely, |
|
| |
|
| /s/ Todd S. Feinstein |
|
| Todd S. Feinstein |
|
Annex E
PROPOSED CERTIFICATE
OF AMENDMENT
TO THE
CERTIFICATE OF INCORPORATION
OF
LOGIQ, INC.
LOGIQ, INC. (the “Corporation”),
a corporation organized and existing under the General Corporation Law of the State of Delaware (the “DGCL”), hereby
certifies as follows:
1. The name of this
corporation is Logiq, Inc., and that this corporation was originally incorporated pursuant to the General Corporation Law on November
18, 2004 under the name Cdoor Corp.
2. Article FOURTH
of the Certificate of Incorporation of the Corporation is hereby amended by replacing the last paragraph of Article FOURTH with the following
new paragraph:
“At the effective
time of this Certificate of Amendment, each [________] (_____) issued and outstanding shares of Common Stock of the Corporation shall,
automatically and without any further action on the part of the Corporation or the holder thereof, be combined and converted into one
(1) validly issued, fully paid and non-assessable share of Common Stock of the Corporation, provided that in the event
a stockholder would otherwise be entitled to a fraction of a share of Common Stock of the Corporation pursuant to the provisions of this
Article FOURTH, such stockholder shall receive one whole share of Common Stock of the Corporation in lieu of such fractional share and
no fractional shares shall be issued.”
3. This Certificate
of Amendment was duly adopted in accordance with the provisions of Section 242 of the DGCL by the directors and stockholders of the
Corporation.
IN WITNESS WHEREOF, the
undersigned has executed this Certificate of Amendment this ___ day of ______, 202_.
| |
LOGIQ, INC. |
| |
|
| |
|
By: |
|
| |
|
|
Name: |
| |
|
|
Title: |
Annex F
Logiq (PK) (USOTC:LGIQ)
Historical Stock Chart
From Mar 2024 to Apr 2024
Logiq (PK) (USOTC:LGIQ)
Historical Stock Chart
From Apr 2023 to Apr 2024
