Item
1. Business
Introduction
We
are a newly organized blank check company incorporated on March 11, 2021 as a Cayman Islands exempted company for the purpose of effecting
a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses.
To date, we have not selected any potential business combination target, and we have not, nor has anyone on our behalf, initiated any
substantive discussions, directly or indirectly, with any potential business combination target with respect to an initial business combination
with us.
While
we may pursue an initial business combination target in any business, industry or geographical location, we intend to focus our search
for a target in Latin America, and more specifically in Brazil, and in sectors with technology-enabled transformations and strong growth
potential in the region, including, but not limited to technology, healthcare, education services, consumer and retail, or the Target
Sectors.
Our
sponsor is an affiliate of Crescera. Founded in 2008, Crescera is an independent asset management firm based in Brazil that currently
manages approximately R$3.7 billion in assets under management, or AUM, focused on two main investment strategies: growth equity and
venture capital, in each case in Brazil. The core of Crescera’s investment team is comprised of six senior investment professionals,
five of which have worked together at Crescera for the past ten years, investing successfully in Brazilian companies within the Target
Sectors. Overall, Crescera’s investment team is composed of 11 talented professionals.
Crescera’s
track record has enabled it to raise and invest successfully in four growth equity funds, as well as two venture capital funds. Crescera
is currently investing out of its fifth growth equity and fundraising for its third venture capital vintages. A distinguishing aspect
of Crescera’s strategy is its partnership model. Crescera believes that this feature has helped it attract, develop and retain
top-quality talent.
Crescera
focuses on areas in which it has significant industry expertise. The main areas in which Crescera has developed such expertise are technology,
healthcare, education and consumer, retail and services. Crescera combines its strategy and expertise with capital to help build companies
into regional or national leaders. By combining its extensive knowledge of Brazilian markets with deep industry expertise, Crescera seeks
to position itself as a partner of choice for leading Brazilian entrepreneurs and family-owned companies, adding significant value through
hands-on governance and strategic inputs, as well as providing capital for growth.
Furthermore,
we believe that Crescera’s value creation capabilities as well as its efforts to position itself as a partner of choice have been
recognized by companies within the Target Sectors. We believe that this has helped enhance proprietary origination capabilities, as such
companies often seek out Crescera as a partner or prefer Crescera over other potential financial sponsors.
Company
History
On
November 23, 2021, we consummated our initial public offering (the “IPO”) of 20,125,000 Public Units, including the issuance of 2,625,000 Units as a result of the underwriter’s (the “Underwriter”) exercise of its over-allotment
option (“Over-allotment Option”) in full, at a price of $10.00
per Public Unit, generating gross proceeds of $201,250,000. Simultaneously with the closing of our IPO, we consummated the sale of 10,150,000
Private Placement Warrants, at a price of $1.00 per Private Placement Warrant, in a Private Placement to CC Sponsor LLC (the “Sponsor”),
generating gross proceeds of $10,150,000.
Of
the net proceeds from the IPO, exercise of the over-allotment option, and associated private placements, $205,275,000 of cash was placed
in the Trust Account.
We
cannot assure you that our plans to complete our initial business combination will be successful.
On
January 10, 2022, we announced that, commencing January 10, 2022, holders of the 20,125,000 units sold in the IPO may elect to separately
trade the Crescera Class A Ordinary Shares and the public warrants included in the units. Those units not separated continued to trade
on Nasdaq under the symbol “CRECU” and the Crescera Class A Ordinary Shares and public warrants that were separated trade
under the symbols “CREC” and “CRECW,” respectively.
Initial
Business Combination
The
rules of the Nasdaq Stock Market require that our initial business combination must occur with one or more target businesses that together
have an aggregate fair market value of at least 80% of the net assets held in the trust account (excluding the amount of deferred underwriting
commissions held in the trust account and taxes payable on the income earned on the trust account) at the time of signing the agreement
to enter into the initial business combination. Our board of directors will make the determination as to the fair market value of our
initial business combination upon standards generally accepted by the financial community. If our board of directors is not able to independently
determine the fair market value of the target business or businesses, or if we are considering an initial business combination with an
affiliated entity, such transaction would be subject to approval by a majority of our independent and disinterested directors. We would
not be required to obtain an opinion from a third party firm in such event to address whether the business combination is fair to our
public shareholders from a financial point of view. We do not intend to purchase multiple businesses in unrelated industries in conjunction
with our initial business combination. We also will not be permitted to effectuate our initial business combination with another blank
check company or a similar company with nominal operations. Subject to these limitations, our directors and executive officers will have
virtually unlimited flexibility in identifying and selecting one or more prospective businesses.
We
may, at our option, pursue an acquisition opportunity jointly with Crescera, or one or more parties affiliated with Crescera, including
without limitation officers and affiliates of Crescera, funds associated with Crescera or investors in such funds. Any such party may co-invest with
us in the target business at the time of our initial business combination, or we could raise additional proceeds to complete the acquisition
by borrowing from or issuing to such parties a class of equity or debt securities. The amount and other terms and conditions of any such
joint acquisition or specified future issuance would be determined at the time thereof.
We
anticipate structuring our initial business combination so that the post-business combination company in which our public shareholders
own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure
our initial business combination such that the post-business combination company owns or acquires less than 100% of such interests or
assets of the target business in order to meet certain objectives of the prior owners of the target business, the target management team
or shareholders or for other reasons. We will only complete such business combination if the post-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, or the Investment
Company Act. Even if the post-business combination company owns or acquires 50% or more of the voting securities of the target, our shareholders
prior to the business combination may collectively own a minority interest in the post-business combination company, depending on the
relative valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction
in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock, shares or other equity interests
of a target or issue a substantial number of new shares to third parties in connection with financing our initial business combination.
In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number
of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our issued and
outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business
or businesses are owned or acquired by the post-business combination company, the portion of such business or businesses that is owned
or acquired is what will be valued for purposes of the 80% of net assets test. If the business combination involves more than one target
business, the 80% of net assets test will be based on the aggregate value of all of the target businesses and we will treat the target
businesses together as the initial business combination for purposes of a tender offer or for seeking shareholder approval, as applicable.
The
time required to select and evaluate a target business and to structure and complete our initial business combination, and the costs
associated with this process, are not currently ascertainable with any degree of certainty. Any costs incurred with respect to the identification
and evaluation of a prospective target business with which our initial business combination is not ultimately completed will result in
our incurring losses and will reduce the funds we can use to complete another business combination.
Other
Considerations
We
currently do not have any specific business combination under consideration. Crescera and our directors and officers are regularly made
aware of potential business combination opportunities, one or more of which we may desire to pursue. However, we have not selected any
business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly,
with any business combination target.
In
addition, certain of our directors and officers currently have, and any of them in the future may have additional, fiduciary and contractual
duties to other entities, including without limitation Crescera and funds associated with Crescera or their current or former portfolio
companies. These funds may have overlapping investment objectives and potential conflicts may arise with respect to Crescera’s
decision regarding how to allocate investment opportunities among these funds. If any of our directors and officers becomes aware of
a business combination opportunity that is suitable for a fund or entity to which he or she has then-current fiduciary or contractual
obligations (including, without limitation, any funds associated with Crescera or their current or former portfolio companies), then,
subject to their fiduciary duties under Cayman Islands law, he or she will need to honor such fiduciary or contractual obligations to
present such business combination opportunity to such fund or entity, before we can pursue such opportunity. If Crescera, funds associated
with Crescera or other entities decide to pursue any such opportunity, we may be precluded from pursuing the same. In addition, investment
ideas generated within or presented to Crescera or our directors and executive officers may be suitable for both us and Crescera, a current
or future Crescera fund or one or more of their portfolio companies and, subject to applicable fiduciary duties or contractual obligations,
will first be directed to Crescera, such fund, investment vehicle or portfolio company before being directed, if at all, to us. However,
we do not expect these fiduciary duties or contractual obligations to materially affect our ability to identify and pursue business combination
opportunities or to complete our initial business combination. Our amended and restated memorandum and articles of association provide
that, to the fullest extent permitted by applicable law: (i) no individual serving as a director or an officer shall have any duty, except
and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities
or lines of business as us; and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in,
any potential transaction or matter which may be a corporate opportunity (including with respect to any business transaction that may
involve another Crescera entity) for any director or officer, on the one hand, and us, on the other. Accordingly, Crescera and our directors
or officers may not be obliged to present a business combination opportunity to us.
Our
officers and directors, including our chief executive officer, are and in the future will be required to commit time and attention to
Crescera and current and future funds associated with Crescera. To the extent any conflict of interest arises between, on the one hand,
us and, on the other hand, any of such entities (including, without limitation, arising as a result of certain of officers and directors
being required to offer acquisition opportunities to such entities), Crescera and its affiliated funds will resolve such conflict of
interest in their sole discretion in accordance with their then existing fiduciary, contractual and other duties and there can be no
assurance that such conflict of interest will be resolved in our favor.
On
November 17, 2021, we filed a Registration Statement on Form 8-A with the U.S. Securities and Exchange Commission, or the SEC, to voluntarily
register our securities under Section 12 of the Securities Exchange Act of 1934, as amended, or the Exchange Act. As a result, we are
subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend
our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination.
Corporate
Information
Our
executive offices are located at R. Aníbal de Mendonça, 27, 2nd floor, Rio de Janeiro, RJ 22410-050, Brazil, our telephone
number is +55 (21) 3687-1500 and our corporate website is https://cresceraspac.com/. Our website and the information contained on, or
that can be accessed through, the website is not deemed to be incorporated by reference in, and is not considered part of, this annual
report.
We
are a Cayman Islands exempted company. Exempted companies are Cayman Islands companies conducting business mainly outside the Cayman
Islands and, as such, are exempted from complying with certain provisions of the Companies Act (As Revised) of the Cayman Islands, or
the Companies Act. As an exempted company, we have received a tax exemption undertaking from the Cayman Islands government that, in accordance
with Section 6 of the Tax Concessions Act (As Revised) of the Cayman Islands, for a period of 20 years from the date of the undertaking,
no law which is enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations will apply to
us or our operations and, in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature
of estate duty or inheritance tax will be payable (i) on or in respect of our shares, debentures or other obligations or (ii) by way
of the withholding in whole or in part of a payment of dividend or other distribution of income or capital by us to our shareholders
or a payment of principal or interest or other sums due under a debenture or other obligation of us.
We
are an “emerging growth company,” as defined in Section 2(a) of the Securities Act of 1933, as amended (the “Securities
Act”), as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). As such, we are eligible to
take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging
growth companies” including, but not limited to, not being required to comply with the auditor attestation requirements of Section
404 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”), reduced disclosure obligations regarding executive compensation
in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive
compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities
less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more
volatile.
In
addition, Section 107 of the JOBS Act also provides that an “emerging growth company” can take advantage of the extended
transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other
words, an “emerging growth company” can delay the adoption of certain accounting standards until those standards would otherwise
apply to private companies. We intend to take advantage of the benefits of this extended transition period.
We
will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of
the completion of our IPO,
(b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer,
which means the market value of our Class A ordinary shares that are held by non-affiliates equals or exceeds $700 million as of the
prior June 30, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year
period. References herein to “emerging growth company” will have the meaning associated with it in the JOBS Act.
Additionally,
we are a “smaller reporting company” as defined in Rule 10(f)(1) of Regulation S-K. Smaller reporting companies may take
advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements.
We will remain a smaller reporting company until the last day of any fiscal year for so long as either (1) the market value of our ordinary
shares held by non-affiliates did not equal or exceed $250 million as of the prior June 30, or (2) our annual revenues did not equal
or exceed $100 million during such completed fiscal year and the market value of our ordinary shares held by non-affiliates did not equal
or exceed $700 million as of the prior June 30.
Effecting
Our Initial Business Combination
General
We
are not presently engaged in, and we will not engage in, any operations for an indefinite period of time following our IPO until closing
a business combination. We intend to effectuate our initial business combination using cash held in the Trust Account, the proceeds of
the sale of our shares in connection with our initial business combination (pursuant to forward purchase agreements or backstop agreements
we may enter into), shares issued to the owners of the target, debt issued to bank or other lenders or the owners of the target, or a
combination of the foregoing. We may seek to complete our initial business combination with a company or business that may be financially
unstable or in its early stages of development or growth, which would subject us to the numerous risks inherent in such companies and
businesses.
If
our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account
are used for payment of the consideration in connection with our initial business combination or used for redemptions of our Class A
ordinary shares, we may use the balance of the cash released to us from the trust account following the closing for general corporate
purposes, including for maintenance or expansion of operations of the post-business combination company, the payment of principal or
interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for
working capital.
We
have not selected any specific business combination target and we have not, nor has anyone on our behalf, engaged in any substantive
discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us. While
we may pursue an initial business combination target in any industry, we intend to focus our search on Brazilian companies in sectors
with strong growth potential benefiting from positive trends in the region, including, but not limited to, healthcare, technology, education
services, consumer and retail.
Although
our management will assess the risks inherent in a particular target business with which we may combine, we cannot assure you that this
assessment will result in our identifying all risks that a target business may encounter. Furthermore, some of those risks may be outside
of our control, meaning that we can do nothing to control or reduce the chances that those risks will adversely affect a target business.
We
may seek to raise additional funds through a private offering of debt or equity securities in connection with the completion of our initial
business combination and we may effectuate our initial business combination using the proceeds of such offering rather than using the
amounts held in the trust account. In addition, we intend to target businesses with enterprise values that are greater than we could
acquire with the net proceeds of our IPO and the sale of the private placement warrants, and, as a result, if the cash portion of the
purchase price exceeds the amount available from the trust account, net of amounts needed to satisfy any redemptions by public shareholders,
we may be required to seek additional financing to complete such proposed initial business combination. Subject to compliance with applicable
securities laws, we would expect to complete such financing only simultaneously with the completion of our initial business combination.
In the case of an initial business combination funded with assets other than the trust account assets, our proxy materials or tender
offer documents disclosing the initial business combination would disclose the terms of the financing and, only if required by law, we
would seek shareholder approval of such financing. There is no limitation on our ability to raise funds through the issuance of equity
or equity-linked securities or through loans, advances or other indebtedness in connection with our initial business combination, including
pursuant to forward purchase agreements or backstop agreements we may enter into in the future. At this time, we are not a party to any
arrangement or understanding with any third party with respect to raising any additional funds through the sale of securities or otherwise.
Neither our sponsor, nor any of our officers, directors or shareholders are required to provide any financing to us in connection with
or after our initial business combination.
Sources
of Target Businesses
We
anticipate that our officers and directors, as well as their affiliates, may bring to our attention target business candidates of which
they become aware through their business contacts as a result of formal or informal inquiries or discussions they may have, as well as
attending trade shows or conventions. In addition, we expect to receive a number of proprietary deal flow opportunities that would not
otherwise necessarily be available to us as a result of the track record and business relationships of our officers and directors. In
addition, various unaffiliated sources, including but not limited to investment bankers and private investment funds, may bring target
businesses to our attention as a result of being solicited by us through calls or mailings. These sources may also introduce us to target
businesses in which they think we may be interested on an unsolicited basis, since many of these sources will have read this annual report
and know what types of businesses we are targeting. While we do not presently anticipate engaging the services of professional firms
or other individuals that specialize in business acquisitions on any formal basis, we may engage these firms or other individuals in
the future, in which event we may pay a finder’s fee, consulting fee or other compensation to be determined in an arm’s length
negotiation based on the terms of the transaction. We will engage a finder only to the extent our management determines that the use
of a finder may bring opportunities to us that may not otherwise be available to us or if finders approach us on an unsolicited basis
with a potential transaction that our management determines is in our best interest to pursue. Payment of a finder’s fee is customarily
tied to completion of a transaction, in which case any such fee will be paid out of the funds held in the trust account. In no event,
however, will our sponsor or any of our existing officers or directors, or any entity with which they are affiliated, be paid any finder’s
fee, consulting fee or other compensation by the company prior to, or for any services they render in order to effectuate, the completion
of our initial business combination (regardless of the type of transaction that it is). Any such payments prior to our initial business
combination will be made from funds held outside the trust account. Other than the foregoing, there will be no finder’s fees, reimbursement,
consulting fee, monies in respect of any payment of a loan or other compensation paid by us to our sponsor, officers or directors, or
any affiliate of our 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).
We
are not prohibited from pursuing an initial business combination with a business combination target that is affiliated with our sponsor,
officers, directors or funds managed by certain of our affiliates, or from completing the business combination through a joint venture
or other form of shared ownership with our sponsor, officers, directors or funds managed by certain of our affiliates. In the event we
seek to complete our initial business combination with a business combination target that is affiliated with our sponsor, officers, directors
or funds managed by certain of our affiliates, such transaction would be subject to approval by a majority of our independent and disinterested
directors to determine whether such initial business combination is fair to our company from a financial point of view. We would not
be required to obtain an opinion from a third party firm in such event to address whether the business combination is fair to our public
shareholders from a financial point of view.
Evaluation
of a Target Business and Structuring of Our Initial Business Combination
In
evaluating a prospective target business, we expect to conduct a due diligence review which may encompass, among other things, meetings
with incumbent management and employees, document reviews, interviews of customers and suppliers, inspection of facilities, as applicable,
as well as a review of financial, operational, legal and other information which will be made available to us. If we determine to move
forward with a particular target, we will proceed to structure and negotiate the terms of the business combination transaction.
The
time required to select and evaluate a target business and to structure and complete our initial business combination, and the costs
associated with this process, are not currently ascertainable with any degree of certainty. Any costs incurred with respect to the identification
and evaluation of, and negotiation with, a prospective target business with which our initial business combination is not ultimately
completed will result in our incurring losses and will reduce the funds we can use to complete another business combination. The company
will not pay any consulting fees to members of our management team, or any of their respective affiliates, for services rendered to or
in connection with our initial business combination.
Lack
of Business Diversification
For
an indefinite period of time after the completion of our initial business combination, the prospects for our success may depend entirely
on the future performance of a single business. Unlike other entities that have the resources to complete business combinations with
multiple entities in one or several industries, it is probable that we will not have the resources to diversify our operations and mitigate
the risks of being in a single line of business. By completing our initial business combination with only a single entity, our lack of
diversification may:
| ● | subject
us to negative economic, competitive and regulatory developments, any or all of which may
have a substantial adverse impact on the particular industry in which we operate after our
initial business combination, and |
| ● | cause
us to depend on the marketing and sale of a single product or limited number of products
or services. |
Limited
Ability to Evaluate the Target’s Management Team
Although
we intend to closely scrutinize the management of a prospective target business when evaluating the desirability of effecting our initial
business combination with that business, our assessment of the target business’s management may not prove to be correct. In addition,
the future management may not have the necessary skills, qualifications or abilities to manage a public company. Furthermore, the future
role of members of our management team, if any, in the target business cannot presently be stated with any certainty. The determination
as to whether any of the members of our management team will remain with the combined company will be made at the time of our initial
business combination. While it is possible that one or more of our directors will remain associated in some capacity with us following
our initial business combination, it is unlikely that any of them will devote their full efforts to our affairs subsequent to our initial
business combination. Moreover, we cannot assure you that members of our management team will have significant experience or knowledge
relating to the operations of the particular target business.
We
cannot assure you that any of our key personnel will remain in senior management or advisory positions with the combined company. The
determination as to whether any of our key personnel will remain with the combined company will be made at the time of our initial business
combination.
Following
a business combination, we may seek to recruit additional managers to supplement the incumbent management of the target business. We
cannot assure you that we will have the ability to recruit additional managers, or that additional managers will have the requisite skills,
knowledge or experience necessary to enhance the incumbent management.
Shareholders
May Not Have the Ability to Approve Our Initial Business Combination
We
may conduct redemptions without a shareholder vote pursuant to the tender offer rules of the SEC subject to the provisions of our amended
and restated memorandum and articles of association. However, we will seek shareholder approval if it is required by law or applicable
stock exchange rule, or we may decide to seek shareholder approval for business or other reasons.
Under
Nasdaq’s listing rules, shareholder approval would be required for our initial business combination if, for example:
| ● | We
issue ordinary shares that will be equal to or in excess of 20% of the number of our Class
A shares then issued and outstanding (other than in a public offering); |
| ● | Any
of our directors, officers or substantial security holders (as defined by Nasdaq rules) has
a 5% or greater interest earned on the trust account (or such persons collectively have a
10% or greater interest), directly or indirectly, in the target business or assets to be
acquired or otherwise and the present or potential issuance of ordinary shares could result
in an increase in outstanding ordinary shares or voting power of 5% or more; or |
| ● | The
issuance or potential issuance of ordinary shares will result in our undergoing a change
of control. |
Permitted
Purchases of Our Securities
If
we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business
combination pursuant to the tender offer rules, our sponsor, initial shareholders, directors, officers, advisors or their affiliates
may purchase shares or public warrants in privately negotiated transactions or in the open market either prior to or following the completion
of our initial business combination. There is no limit on the number of shares our initial shareholders, directors, officers, advisors
or their affiliates may purchase in such transactions, subject to compliance with applicable law and Nasdaq rules. However, they
have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any
such transactions. None of the funds in the trust account will be used to purchase shares or public warrants in such transactions. If
they engage in such transactions, they will not make any such purchases when they are in possession of any material non-public information
not disclosed to the seller or if such purchases are prohibited by Regulation M under the Exchange Act.
In
the event that our sponsor, directors, officers, advisors or their affiliates purchase shares in privately negotiated transactions from
public shareholders who have already elected to exercise their redemption rights, such selling shareholders would be required to revoke
their prior elections to redeem their shares. We do not currently anticipate that such purchases, if any, would constitute a tender offer
subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the
Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the
purchasers will comply with such rules.
The
purpose of any such purchases of shares could be to (i) vote such shares in favor of the business combination and thereby increase
the likelihood of obtaining shareholder approval of the business combination or (ii) to satisfy a closing condition in an agreement
with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination,
where it appears that such requirement would otherwise not be met. The purpose of any such purchases of public warrants could be to reduce
the number of public warrants outstanding or to vote such warrants on any matters submitted to the warrant holders for approval in connection
with our initial business combination. Any such purchases of our securities may result in the completion of our initial business combination
that may not otherwise have been possible.
In
addition, if such purchases are made, the public “float” of our Class A ordinary shares or public warrants may be reduced
and the number of beneficial holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation,
listing or trading of our securities on a national securities exchange.
Our
sponsor, officers, directors and/or their affiliates anticipate that they may identify the shareholders with whom our initial shareholders,
officers, directors or their affiliates may pursue privately negotiated purchases by either the shareholders contacting us directly or
by our receipt of redemption requests submitted by shareholders (in the case of Class A ordinary shares) following our mailing of proxy
materials in connection with our initial business combination. To the extent that our sponsor, officers, directors, advisors or their
affiliates enter into a private purchase, they would identify and contact only potential selling shareholders who have expressed their
election to redeem their shares for a pro rata share of the trust account or vote against our initial business combination, whether or
not such shareholder has already submitted a proxy with respect to our initial business combination but only if such shares have not
already been voted at the general meeting related to our initial business combination. Our sponsor, officers, directors, advisors or
any of their affiliates will select which shareholders to purchase shares from based on a negotiated price and number of shares and any
other factors that they may deem relevant, and will only purchase shares if such purchases comply with Regulation M under the Exchange
Act and the other federal securities laws. Our sponsor, officers, directors and/or their affiliates will not make purchases of shares
if the purchases would violate Section 9(a)(2) or Rule 10b-5 of the Exchange Act. Any such purchases will be reported pursuant to Section
13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements.
Redemption
Rights for Public Shareholders upon Completion of Our Initial Business Combination
We
will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion
of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust
account calculated as of two business days prior to the consummation of the initial business combination, including interest earned on
the funds held in the trust account and not previously released to us to pay our taxes, divided by the number of then outstanding public
shares, subject to the limitations and on the conditions described herein. The per-share amount we will distribute to investors who properly
redeem their shares will not be reduced by the deferred underwriting commissions we will pay to the underwriters. The redemption rights
will include the requirement that a beneficial holder must identify itself in order to validly redeem its shares. There will be no redemption
rights upon the completion of our initial business combination with respect to our warrants. Our 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 founder
shares and any public shares they may hold in connection with the completion of our initial business combination.
Limitations
on Redemptions
Our
amended and restated memorandum and articles of association provide that in no event will we redeem our public shares in an amount that
would cause our net tangible assets to be less than $5,000,001. In addition, our proposed initial business combination may impose a minimum
cash requirement for (i) cash consideration to be paid to the target or its owners, (ii) cash for working capital or other
general corporate purposes or (iii) the retention of cash to satisfy other conditions. In the event the aggregate cash consideration
we would be required to pay for all Class A ordinary shares that are validly submitted for redemption plus any amount required to satisfy
cash conditions pursuant to the terms of the proposed initial business combination exceed the aggregate amount of cash available to us,
we will not complete the initial business combination or redeem any shares, and all Class A ordinary shares submitted for redemption
will be returned to the holders thereof. We may, however, raise funds through the issuance of equity-linked securities or through loans,
advances or other indebtedness in connection with our initial business combination, including pursuant to forward purchase agreements
or backstop arrangements we may enter into, in order to, among other reasons, satisfy such net tangible assets or minimum cash requirements.
Manner
of Conducting Redemptions
We
will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion
of our initial business combination either (i) in connection with a general meeting called to approve the business combination or
(ii) without a shareholder vote by means of a tender offer. The decision as to whether we will seek shareholder approval of a proposed
business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors
such as the timing of the transaction and whether the terms of the transaction would require us to seek shareholder approval under applicable
law or stock exchange listing requirement or whether we were deemed to be a foreign private issuer (which would require a tender offer
rather than seeking shareholder approval under SEC rules). Asset acquisitions and share purchases would not typically require shareholder
approval while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our issued
and outstanding ordinary shares or seek to amend our amended and restated memorandum and articles of association would require shareholder
approval. So long as we obtain and maintain a listing for our securities on Nasdaq, we will be required to comply with Nasdaq’s
shareholder approval rules.
The
requirement that we provide our public shareholders with the opportunity to redeem their public shares by one of the two methods listed
above is contained in provisions of our amended and restated memorandum and articles of association and will apply whether or not we
maintain our registration under the Exchange Act or our listing on the Nasdaq. Such provisions may be amended if approved by holders
of two-thirds of our ordinary shares entitled to vote thereon, so long as we offer redemption in connection with such amendment.
If
we provide our public shareholders with the opportunity to redeem their public shares in connection with a general meeting, we will,
pursuant to our amended and restated memorandum and articles of association:
| ● | conduct
the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the
Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender
offer rules, and |
| ● | file
proxy materials with the SEC. |
In
the event that we seek shareholder approval of our initial business combination, we will distribute proxy materials and, in connection
therewith, provide our public shareholders with the redemption rights described above upon completion of the initial business combination.
If
we seek shareholder approval, we will complete our initial business combination only if we receive an ordinary resolution under Cayman
Islands law, which requires the affirmative vote of a majority of the shareholders who attend and vote at a general meeting of the company.
A quorum for such meeting will be present if the holders of a majority of issued and outstanding shares entitled to vote at the meeting
are represented in person or by proxy. Our sponsor, officers and directors will count toward this quorum and, pursuant to the letter
agreement, our sponsor, officers and directors have agreed to vote their founder shares, shares underlying the private placement warrants
and any public shares purchased during or after the IPO (including in open market and privately-negotiated transactions) in favor of
our initial business combination. For purposes of seeking approval of an ordinary resolution, non-votes will have no effect on the approval
of our initial business combination once a quorum is obtained. These quorum and voting thresholds, and the voting agreement of our sponsor,
officers and directors, may make it more likely that we will consummate our initial business combination. Each public shareholder may
elect to redeem their public shares irrespective of whether they vote for or against the proposed transaction or whether they were a
public shareholder on the record date for the general meeting held to approve the proposed transaction.
If
a shareholder vote is not required and we do not decide to hold a shareholder vote for business or other legal reasons, we will:
| ● | conduct
the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate
issuer tender offers, and |
| ● | file
tender offer documents with the SEC prior to completing our initial business combination
which contain substantially the same financial and other information about the initial business
combination and the redemption rights as is required under Regulation 14A of the Exchange
Act, which regulates the solicitation of proxies. |
In
the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days,
in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until
the expiration of the tender offer period. In addition, the tender offer will be conditioned on public shareholders not tendering more
than the number of public shares we are permitted to redeem. If public shareholders tender more shares than we have offered to purchase,
we will withdraw the tender offer and not complete the initial business combination.
Upon
the public announcement of our initial business combination, if we elect to conduct redemption pursuant to the tender offer rules, we
or our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase our Class A ordinary shares in the open
market, in order to comply with Rule 14e-5 under the Exchange Act.
We
intend to require our public shareholders seeking to exercise their redemption rights, whether they are record holders or hold their
shares in “street name,” to, at the holder’s option, either deliver their share certificates to our transfer agent
or deliver their shares to our transfer agent electronically using the Depository Trust Company’s DWAC (Deposit/Withdrawal At Custodian)
system, prior to the date set forth in the proxy materials or tender offer documents, as applicable. In the case of proxy materials,
this date may be up to two business days prior to the scheduled vote on the proposal to approve the initial business combination. In
addition, if we conduct redemptions in connection with a shareholder vote, we intend to require a public shareholder seeking redemption
of its public shares to also submit a written request for redemption to our transfer agent two business days prior to the scheduled vote
in which the name of the beneficial owner of such shares is included. The proxy materials or tender offer documents, as applicable, that
we will furnish to holders of our public shares in connection with our initial business combination will indicate whether we are requiring
public shareholders to satisfy such delivery requirements. We believe that this will allow our transfer agent to efficiently process
any redemptions without the need for further communication or action from the redeeming public shareholders, which could delay redemptions
and result in additional administrative cost. If the proposed initial business combination is not approved and we continue to search
for a target company, we will promptly return any certificates or shares delivered by public shareholders who elected to redeem their
shares.
Limitation
on Redemption Upon Completion of Our Initial Business Combination If We Seek Shareholder Approval
If
we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business
combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association provide that a public
shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as
a “group” (as defined under Section 13 of the Exchange Act), will be restricted from seeking redemption rights with respect
to Excess Shares without our prior consent. We believe this restriction will discourage shareholders from accumulating large blocks of
shares, and subsequent attempts by such holders to use their ability to exercise their redemption rights against a proposed business
combination as a means to force us or our management to purchase their shares at a significant premium to the then-current market price
or on other undesirable terms. Absent this provision, a public shareholder holding more than an aggregate of 15% of the shares could
threaten to exercise its redemption rights if such holder’s shares are not purchased by us, our sponsor or our management at a
premium to the then-current market price or on other undesirable terms. By limiting our shareholders’ ability to redeem no more
than 15% of the shares sold in our IPO without our prior consent, we believe we will limit the ability of a small group of shareholders
to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with a business
combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash.
However,
we would not be restricting our shareholders’ ability to vote all of their shares (including Excess Shares) for or against our
initial business combination.
Delivering
Share Certificates in Connection with the Exercise of Redemption Rights
As
described above, we intend to require our public shareholders seeking to exercise their redemption rights, whether they are record holders
or hold their shares in “street name,” to, at the holder’s option, either deliver their share certificates to our transfer
agent or deliver their shares to our transfer agent electronically using the Depository Trust Company’s DWAC (Deposit/Withdrawal
At Custodian) system, prior to the date set forth in the proxy materials or tender offer documents, as applicable. In the case of proxy
materials, this date may be up to two business days prior to the scheduled vote on the proposal to approve the initial business combination.
In addition, if we conduct redemptions in connection with a shareholder vote, we intend to require a public shareholder seeking redemption
of its public shares to also submit a written request for redemption to our transfer agent two business days prior to the scheduled vote
in which the name of the beneficial owner of such shares is included. The proxy materials or tender offer documents, as applicable, that
we will furnish to holders of our public shares in connection with our initial business combination will indicate whether we are requiring
public shareholders to satisfy such delivery requirements. Accordingly, a public shareholder would have up to two business days prior
to the scheduled vote on the initial business combination if we distribute proxy materials, or from the time we send out our tender offer
materials until the close of the tender offer period, as applicable, to submit or tender its shares if it wishes to seek to exercise
its redemption rights. In the event that a shareholder fails to comply with these or any other procedures disclosed in the proxy or tender
offer materials, as applicable, its shares may not be redeemed. Given the relatively short exercise period, it is advisable for shareholders
to use electronic delivery of their public shares.
There
is a nominal cost associated with the above-referenced process and the act of certificating the shares or delivering them through the
DWAC system. The transfer agent will typically charge the broker submitting or tendering shares a fee of approximately $80.00 and it
would be up to the broker whether or not to pass this cost on to the redeeming holder. However, this fee would be incurred regardless
of whether or not we require holders seeking to exercise redemption rights to submit or tender their shares. The need to deliver shares
is a requirement of exercising redemption rights regardless of the timing of when such delivery must be effectuated.
Any
request to redeem such shares, once made, may be withdrawn at any time up to the date set forth in the proxy materials or tender offer
documents, as applicable. Furthermore, if a holder of a public share delivered its certificate in connection with an election of redemption
rights and subsequently decides prior to the applicable date not to elect to exercise such rights, such holder may simply request that
the transfer agent return the certificate (physically or electronically). It is anticipated that the funds to be distributed to holders
of our public shares electing to redeem their shares will be distributed promptly after the completion of our initial business combination.
If
our initial business combination is not approved or completed for any reason, then our public shareholders who elected to exercise their
redemption rights would not be entitled to redeem their shares for the applicable pro rata share of the trust account. In such case,
we will promptly return any certificates delivered by public holders who elected to redeem their shares.
If
our initial proposed business combination is not completed, we may continue to try to complete a business combination with a different
target until May 23, 2023 (or November 23, 2023 if we extend the period of time to consummate our initial business combination in accordance
with the terms described in our final prospectus).
Redemption
of Public Shares and Liquidation if No Initial Business Combination
Our
amended and restated memorandum and articles of association provide that we will have until May 23, 2023 (or November 23, 2023 if we
extend the period of time to consummate our initial business combination in accordance with the terms described in our final prospectus).
If we have not completed our initial business combination within such period, we will: (i) cease all operations except for the purpose
of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares,
at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned
on the funds held in the trust account and not previously released to us to pay our taxes (less up to $100,000 of interest income to
pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public
shareholders’ rights as shareholders (including the right to receive further liquidation distributions, if any) and (iii) as
promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our board of directors,
liquidate and dissolve, subject in the case of clauses (ii) and (iii) to our obligations under Cayman Islands law to provide for claims
of creditors and in all cases subject to the other requirements of applicable law. There will be no redemption rights or liquidating
distributions with respect to our warrants, which will expire worthless if we fail to complete our initial business combination within
the allotted time period.
Our
sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have waived their rights to liquidating
distributions from the trust account with respect to any founder shares held by them if we fail to complete our initial business combination
by May 23, 2023 (or November 23, 2023 if we extend the period of time to consummate our initial business combination in accordance with
the terms described in our final prospectus). However, if our sponsor or management team acquire public shares in or after our IPO, they
will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial
business combination within the allotted time period.
Our
sponsor, officers and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our
amended and restated memorandum and articles of association (A) to modify the substance or timing of our obligation to allow redemption
in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business
combination by May 23, 2023 (or November 23, 2023 if we extend the period of time to consummate our initial business combination in accordance
with the terms described in our final prospectus) or (B) with respect to any other material provisions relating to shareholders’
rights or pre-initial business combination activity, unless we provide our public shareholders with the opportunity to redeem their public
shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the
trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, divided
by the number of then outstanding public shares. However, we may not redeem our public shares in an amount that would cause our net tangible
assets to be less than $5,000,001. If this optional redemption right is exercised with respect to an excessive number of public shares
such that we cannot satisfy the net tangible asset requirement, we would not proceed with the amendment or the related redemption of
our public shares at such time.
We
expect that all costs and expenses associated with implementing our plan of dissolution, as well as payments to any creditors, will be
funded from amounts remaining out of the $1,450,000 of proceeds held outside the trust account, although we cannot assure you that there
will be sufficient funds for such purpose. However, if those funds are not sufficient to cover the costs and expenses associated with
implementing our plan of dissolution, to the extent that there is any interest accrued in the trust account not required to pay income
taxes on interest income earned on the trust account balance, we may request the trustee to release to us an additional amount of up
to $100,000 of such accrued interest to pay those costs and expenses.
If
we were to expend all of the net proceeds of our IPO and the sale of the private placement warrants, other than the proceeds deposited
in the trust account, and without taking into account interest, if any, earned on the trust account, the per-share redemption amount
received by shareholders upon our dissolution would be approximately $10.20. The funds deposited in the trust account could, however,
become subject to the claims of our creditors which would have higher priority than the claims of our public shareholders. We cannot
assure you that the actual per-share redemption amount received by shareholders will not be substantially less than $10.20. While we
intend to pay such amounts, if any, we cannot assure you that we will have funds sufficient to pay or provide for all creditors’
claims.
Although
we will seek to have all vendors, service providers (other than Marcum LLP, 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 shareholders, 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, our management will consider whether competitive alternatives
are reasonably available to us and will only enter into an agreement with such third party if management believes that such third
party’s engagement would be in the best interests of the company under the circumstances. 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. Marcum LLP, our
independent registered public accounting firm, and the underwriters of our IPO will not execute agreements with us waiving such
claims to the monies held in the trust account. In addition, there is no guarantee that such entities will agree to waive any claims
they may have in the future as a result of, or arising out of, any negotiations, contracts or agreements with us and will not seek
recourse against the trust account for any reason. In order to protect the amounts held in the trust account, our sponsor has agreed
that it will be liable to us if and to the extent any claims by a third party (other than Marcum LLP, our independent registered
public accounting firm) for services rendered or products sold to us, or a prospective target business with which we have entered
into a written letter of intent, confidentiality or other similar agreement or business combination agreement, reduce the amount of
funds in the trust account to below the lesser of (i) $10.20 per unit and (ii) the actual amount per public share held in
the trust account as of the date of the liquidation of the trust account, if less than $10.20 per unit due to reductions in the
value of the trust assets, less taxes payable, provided that such liability will not apply to any claims by a third party or
prospective target business who executed a waiver of any and all rights to the monies held in the trust account (whether or not such
waiver is enforceable) nor will it apply to any claims under our indemnity of the underwriters of our IPO against certain
liabilities, including liabilities under the Securities Act. However, we have not asked our sponsor to reserve for such
indemnification obligations, nor have we independently verified whether our sponsor has sufficient funds to satisfy its indemnity
obligations and we believe that our sponsor’s only assets are securities of our company. Therefore, we cannot assure you that
our sponsor would be able to satisfy those obligations. As a result, if any such claims were successfully made against the trust
account, the funds available for our initial business combination and redemptions could be reduced to less than $10.20 per unit. In
such event, we may not be able to complete our initial business combination, and you would receive such lesser amount per share in
connection with any redemption of your public shares. None of our officers or directors will indemnify us for claims by third
parties including, without limitation, claims by vendors and prospective target businesses.
In
the event that the funds in the trust account are reduced below the lesser of (i) $10.20 per unit and (ii) the actual amount
per public share held in the trust account as of the date of the liquidation of the trust account if less than $10.20 per unit due to
reductions in the value of the trust assets, in each case 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 we currently expect that
our independent directors would take legal action on our behalf against our sponsor to enforce its indemnification obligations to us,
it is possible that our independent directors in exercising their business judgment may choose not to do so in any particular instance
if, for example, the cost of such legal action is deemed by the independent directors to be too high relative to the amount recoverable
or if the independent directors determine that a favorable outcome is not likely. Accordingly, we cannot assure you that due to claims
of creditors the actual value of the per-share redemption price will not be less than $10.20 per unit.
We
will seek to reduce the possibility that our sponsor will have to indemnify the trust account due to claims of creditors by endeavoring
to have all vendors, service providers (other than Marcum LLP, our independent registered public accounting firm), prospective target
businesses or other entities with which we do business execute agreements with us waiving any right, title, interest or claim of any
kind in or to monies held in the trust account. Our sponsor will also not be liable as to any claims under our indemnity of the underwriters
of our IPO against certain liabilities, including liabilities under the Securities Act. We will have access to up to $1,450,000 from
the proceeds of our IPO with which to pay any such potential claims (including costs and expenses incurred in connection with our liquidation,
currently estimated to be no more than approximately $100,000). In the event that we liquidate and it is subsequently determined that
the reserve for claims and liabilities is insufficient, shareholders who received funds from our trust account could be liable for claims
made by creditors. In the event that our offering expenses exceed our estimate of $650,000, we may fund such excess with funds from the
funds not to be held in the trust account. In such case, the amount of funds we intend to be held outside the trust account would decrease
by a corresponding amount. Conversely, in the event that the offering expenses are less than our estimate of $650,000, the amount of
funds we intend to be held outside the trust account would increase by a corresponding amount.
If
we file a bankruptcy or winding-up petition or an involuntary bankruptcy or winding-up petition is filed against us that is not dismissed,
the funds held in the trust account could be subject to applicable bankruptcy or insolvency law, and may be included in our bankruptcy
estate and subject to the claims of third parties with priority over the claims of our shareholders. To the extent any bankruptcy or
insolvency claims deplete the trust account, we cannot assure you we will be able to return $10.20 per unit to our public shareholders.
Additionally, if we file a bankruptcy or winding-up petition or an involuntary bankruptcy or winding-up petition is filed against us
that is not dismissed, any distributions received by shareholders could be viewed under applicable debtor/creditor and/or bankruptcy
or insolvency laws as either a “preferential transfer” or a “fraudulent conveyance.” As a result, a bankruptcy
or insolvency court could seek to recover some or all amounts received by our shareholders. Furthermore, our board of directors 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 our
company to claims of punitive damages, by paying public shareholders from the trust account prior to addressing the claims of creditors.
We cannot assure you that claims will not be brought against us for these reasons.
Our
public shareholders will be entitled to receive funds from the trust account only (i) in the event of the redemption of our public
shares if we do not complete our initial business combination by May 23, 2023 (or November 23, 2023 if we extend the period of time to
consummate our initial business combination in accordance with the terms described in our final prospectus), (ii) in connection
with a shareholder vote to amend our amended and restated memorandum and articles of association (A) to modify the substance or
timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares
if we do not complete our initial business combination by May 23, 2023 (or November 23, 2023 if we extend the period of time to consummate
our initial business combination in accordance with the terms described in our final prospectus) or (B) with respect to any other
material provisions relating to shareholders’ rights or pre-initial business combination activity or (iii) if they redeem
their respective shares for cash upon the completion of our initial business combination. In no other circumstances will a shareholder
have any right or interest of any kind to or in the trust account. In the event we seek shareholder approval in connection with our initial
business combination, a shareholder’s voting in connection with the business combination alone will not result in a shareholder’s
redeeming its shares to us for an applicable pro rata share of the trust account. Such shareholder must have also exercised its redemption
rights described above. These provisions of our amended and restated memorandum and articles of association, like all provisions of our
amended and restated memorandum and articles of association, may be amended with a shareholder vote.
Conflicts
of Interest
Each
of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations
to another entity pursuant to which such officer or director is or will be required to present a business combination opportunity to
such entity. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for
an entity to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual
obligations to present such business combination opportunity to such entity, subject to their fiduciary duties under Cayman Islands law.
Our amended and restated memorandum and articles of association provide that, to the fullest extent permitted by applicable law: (i)
no individual serving as a director or an officer shall have any duty, except and to the extent expressly assumed by contract, to refrain
from engaging directly or indirectly in the same or similar business activities or lines of business as us; and (ii) we renounce any
interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which may be a corporate
opportunity for any director or officer on the one hand, and us, on the other. We do not believe, however, that the fiduciary duties
or contractual obligations of our officers or directors will materially affect our ability to complete our initial business combination.
Facilities
We
currently utilize office space at R. Aníbal de Mendonça, 27, 2nd floor, Rio de Janeiro,
RJ 22410-050, Brazil from our sponsor as our executive offices. We consider our current office space adequate for our current
operations.
Employees
We
currently have two officers: Felipe Samuel Argalji and Laura Guaraná Carvalho. These
individuals are not obligated to devote any specific number of hours to our matters but they intend to devote as much of their time as
they deem necessary to our affairs until we have completed our initial business combination. The amount of time they will devote in any
time period will vary based on whether a target business has been selected for our initial business combination and the stage of the
business combination process we are in. We do not intend to have any full-time employees prior to the completion of our initial business
combination.
Item
1A. Risk Factors
An
investment in our securities involves a high degree of risk. You should consider carefully all of the risks described below, together
with the other information contained in this annual report on Form 10-K and the prospectus associated with our IPO, before making a decision
to invest in our securities. If any of the following events occur, our business, financial condition and operating results may be materially
adversely affected. In that event, the trading price of our securities could decline, and you could lose all or part of your investment.
General
Risk Factors
We
are a blank check company with no operating history and no revenues, and you have no basis on which to evaluate our ability to achieve
our business objective.
We
are a blank check company incorporated under the laws of the Cayman Islands, and all of our activities to date have been related to our
formation, our IPO and our search for a business combination target. Because we lack an operating history, you have no basis upon which
to evaluate our ability to achieve our business objective of completing our initial business combination. We have no plans, arrangements
or understandings with any prospective target business concerning a business combination and may be unable to complete our initial business
combination. If we fail to complete our initial business combination, we will never generate any operating revenues.
Past
performance by our management team, our sponsor and their affiliates, including investments and transactions in which they have participated
and businesses with which they have been associated, may not be indicative of future performance of an investment in the company.
Information
regarding our management team and their affiliates, including investments and transactions in which they have participated and businesses
with which they have been associated, is presented for informational purposes only. Any past experience and performance by our management
team and their affiliates and the businesses with which they have been associated, is not a guarantee that we will be able to successfully
identify a suitable candidate for our initial business combination, that we will be able to provide positive returns to our shareholders,
or of any results with respect to any initial business combination we may consummate. You should not rely on the historical experiences
of our management team and their affiliates, including investments and transactions in which they have participated and businesses
with which they have been associated, as indicative of the future performance of an investment in us or as indicative of every prior
investment by each of the members of our management team or their affiliates. The market price of our securities may be influenced by
numerous factors, many of which are beyond our control, and our shareholders may experience losses on their investment in our securities.
Cyber
incidents or attacks directed at us could result in information theft, data corruption, operational disruption and/or financial loss.
We
depend on digital technologies, including information systems, infrastructure and cloud applications and services, including those of
third parties with which we may deal. Sophisticated and deliberate attacks on, or security breaches in, our systems or infrastructure,
or the systems or infrastructure of third parties or the cloud, could lead to corruption or misappropriation of our assets, proprietary
information and sensitive or confidential data. As an early stage company without significant investments in data security protection,
we may not be sufficiently protected against such occurrences. We may not have sufficient resources to adequately protect against, or
to investigate and remediate any vulnerability to, cyber incidents. It is possible that any of these occurrences, or a combination of
them, could have adverse consequences on our business and lead to financial loss.
We
may not have sufficient funds to satisfy indemnification claims of our directors and officers.
We
have agreed to indemnify our officers and directors to the fullest extent permitted by law. However, our officers and directors have
agreed to waive any right, title, interest or claim of any kind in or to any monies in the trust account and to not seek recourse against
the trust account for any reason whatsoever. Accordingly, any indemnification provided will be able to be satisfied by us only if (i) we
have sufficient funds outside of the trust account or (ii) we consummate an initial business combination. Our obligation to indemnify
our officers and directors may discourage shareholders from bringing a lawsuit against our officers or directors for breach of their
fiduciary duty. These provisions also may have the effect of reducing the likelihood of derivative litigation against our officers and
directors, even though such an action, if successful, might otherwise benefit us and our shareholders. Furthermore, a shareholder’s
investment may be adversely affected to the extent we pay the costs of settlement and damage awards against our officers and directors
pursuant to these indemnification provisions.
Changes
in laws or regulations, or a failure to comply with any laws and regulations, may adversely affect our business, including our ability
to negotiate and complete our initial business combination, and results of operations.
We
are subject to laws and regulations enacted by national, regional and local governments. In particular, we will be required to comply
with certain SEC and other legal requirements. Compliance with, and monitoring of, applicable laws and regulations may be difficult,
time consuming and costly. Those laws and regulations and their interpretation and application may also change from time to time and
those changes could have a material adverse effect on our business, investments and results of operations. In addition, a failure to
comply with applicable laws or regulations, as interpreted and applied, could have a material adverse effect on our business, including
our ability to negotiate and complete our initial business combination, and results of operations.
We
are an emerging growth company and a smaller reporting company within the meaning of the Securities Act, and if we take advantage of
certain exemptions from disclosure requirements available to emerging growth companies or smaller reporting companies, this could make
our securities less attractive to investors and may make it more difficult to compare our performance with other public companies.
We
are an “emerging growth company” within the meaning of the Securities Act, as modified by the JOBS Act, and we may take advantage
of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth
companies, including, but not limited to, not being required to comply with the auditor internal controls attestation requirements of
Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy
statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval
of any golden parachute payments not previously approved. As a result, our shareholders may not have access to certain information they
may deem important. We could be an emerging growth company for up to five years, although circumstances could cause us to lose that status
earlier, including if the market value of our Class A ordinary shares held by non-affiliates equals or exceeds $700 million as of any
June 30 before that time, in which case we would no longer be an emerging growth company as of the following December 31. We cannot predict
whether investors will find our securities less attractive because we will rely on these exemptions. If some investors find our securities
less attractive as a result of our reliance on these exemptions, the trading prices of our securities may be lower than they otherwise
would be, there may be a less active trading market for our securities and the trading prices of our securities may be more volatile.
Further,
Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting
standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do
not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting
standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements
that apply to non-emerging growth companies but any such an election to opt out is irrevocable. We have elected not to opt out of such
extended transition period which means that when a standard is issued or revised and it has different application dates for public or
private companies, we, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new
or revised standard. This may make comparison of our financial statements with another public company which is neither an emerging growth
company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of
the potential differences in accounting standards used.
Additionally,
we are a “smaller reporting company” as defined in Rule 10(f)(1) of Regulation S-K. Smaller reporting companies may take
advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements.
We will remain a smaller reporting company until the last day of any fiscal year for so long as either (1) the market value of our
ordinary shares held by non-affiliates did not exceed $250 million as of the prior June 30, or (2) our annual revenues did not exceed
$100 million during such completed fiscal year and the market value of our ordinary shares held by non-affiliates did not exceed $700
million as of the prior June 30. To the extent we take advantage of such reduced disclosure obligations, it may also make comparison
of our financial statements with other public companies difficult or impossible.
Compliance
obligations under the Sarbanes-Oxley Act may make it more difficult for us to effectuate our initial business combination, require substantial
financial and management resources, and increase the time and costs of completing an initial business combination.
Section
404 of the Sarbanes-Oxley Act requires that we evaluate and report on our system of internal controls beginning with our Annual Report
on Form 10-K for the year ending December 31, 2022. Only in the event we are deemed to be a large accelerated filer or an accelerated
filer, and no longer qualify as an emerging growth company, will we be required to comply with the independent registered public accounting
firm attestation requirement on our internal control over financial reporting. Further, for as long as we remain an emerging growth company,
we will not be required to comply with the independent registered public accounting firm attestation requirement on our internal control
over financial reporting. The fact that we are a blank check company makes compliance with the requirements of the Sarbanes-Oxley Act
particularly burdensome on us as compared to other public companies because a target business with which we seek to complete our initial
business combination may not be in compliance with the provisions of the Sarbanes-Oxley Act regarding adequacy of its internal controls.
The development of the internal control of any such entity to achieve compliance with the Sarbanes-Oxley Act may increase the time and
costs necessary to complete any such business combination.
Because
we are incorporated under the laws of the Cayman Islands, you may face difficulties in protecting your interests, and your ability to
protect your rights through the U.S. Federal courts may be limited.
We
are an exempted company incorporated under the laws of the Cayman Islands. As a result, it may be difficult for investors to effect service
of process within the United States upon our directors or officers, or enforce judgments obtained in the United States courts against
our directors or officers.
Our
corporate affairs will be governed by our amended and restated memorandum and articles of association, the Companies Act (as the same
may be supplemented or amended from time to time) and the common law of the Cayman Islands. We will also be subject to the federal securities
laws of the United States. The rights of shareholders to take action against the directors, actions by minority shareholders and the
fiduciary responsibilities of our directors to us under Cayman Islands law are to a large extent governed by the common law of the Cayman
Islands. The common law of the Cayman Islands is derived in part from comparatively limited judicial precedent in the Cayman Islands
as well as from English common law, the decisions of whose courts are of persuasive authority, but are not binding on a court in the
Cayman Islands. The rights of our shareholders and the fiduciary responsibilities of our directors under Cayman Islands law are different
from what they would be under statutes or judicial precedent in some jurisdictions in the United States. In particular, the Cayman Islands
has a different body of securities laws as compared to the United States, and certain states, such as Delaware, may have more fully developed
and judicially interpreted bodies of corporate law. In addition, Cayman Islands companies may not have standing to initiate a shareholders
derivative action in a Federal court of the United States.
We
have been advised by Maples and Calder, our Cayman Islands legal counsel, that the courts of the Cayman Islands are unlikely (i) to
recognize or enforce against us judgments of courts of the United States predicated upon the civil liability provisions of the federal
securities laws of the United States or any state; and (ii) in original actions brought in the Cayman Islands, to impose liabilities
against us predicated upon the civil liability provisions of the federal securities laws of the United States or any state, so far as
the liabilities imposed by those provisions are penal in nature. In those circumstances, although there is no statutory enforcement in
the Cayman Islands of judgments obtained in the United States, the courts of the Cayman Islands will recognize and enforce a foreign
money judgment of a foreign court of competent jurisdiction without retrial on the merits based on the principle that a judgment of a
competent foreign court imposes upon the judgment debtor an obligation to pay the sum for which judgment has been given provided certain
conditions are met. For a foreign judgment to be enforced in the Cayman Islands, such judgment must be final and conclusive and for a
liquidated sum, and must not be in respect of taxes or a fine or penalty, inconsistent with a Cayman Islands judgment in respect of the
same matter, impeachable on the grounds of fraud or obtained in a manner, or be of a kind the enforcement of which is, contrary to natural
justice or the public policy of the Cayman Islands (awards of punitive or multiple damages may well be held to be contrary to public
policy). A Cayman Islands Court may stay enforcement proceedings if concurrent proceedings are being brought elsewhere.
As
a result of all of the above, public shareholders may have more difficulty in protecting their interests in the face of actions taken
by management, members of the board of directors or controlling shareholders than they would as public shareholders of a United States
company.
Risks
Relating to Our Search for, and Consummation of or Inability to Consummate, a Business Combination
Our
public shareholders may not be afforded an opportunity to vote on our proposed initial business combination, and even if we hold a vote,
holders of our founder shares will participate in such vote, which means we may complete our initial business combination even though
a majority of our public shareholders do not support such a combination.
We
may choose not to hold a shareholder vote to approve our initial business combination if the business combination would not require shareholder
approval under applicable law or stock exchange listing requirement. For instance, Nasdaq rules currently allow us to engage in a tender
offer in lieu of a general meeting but would still require us to obtain shareholder approval if we were seeking to issue more than 20%
of our issued and outstanding ordinary shares to a target business as consideration in any business combination. Therefore, if we were
structuring a business combination that required us to issue more than 20% of our issued and outstanding ordinary shares, we would seek
shareholder approval of such business combination. Except for as required by applicable law or stock exchange requirement, the decision
as to whether we will seek shareholder approval of a proposed business combination or will allow shareholders to sell their shares to
us in a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors, such as the timing of the
transaction and whether the terms of the transaction would otherwise require us to seek shareholder approval. Even if we seek shareholder
approval, the holders of our founder shares will participate in the vote on such approval. Accordingly, we may complete our initial business
combination even if holders of a majority of our public shares do not approve of the business combination we complete.
Your
only opportunity to effect your investment decision regarding a potential business combination may be limited to the exercise of your
right to redeem your shares from us for cash, unless we seek shareholder approval of the business combination.
At
the time of your investment in us, you will not be provided with an opportunity to evaluate the specific merits or risks of our initial
business combination. Since our board of directors may complete a business combination without seeking shareholder approval, public shareholders
may not have the right or opportunity to vote on the business combination, unless we seek such shareholder vote. Accordingly, your only
opportunity to effect the investment decision regarding our initial business combination may be limited to exercising your redemption
rights within the period of time (which will be at least 20 business days) set forth in our tender offer documents mailed to our public
shareholders in which we describe our initial business combination.
Because
of our limited resources and the significant competition for business combination opportunities, it may be more difficult for us to complete
our initial business combination. If we are unable to complete our initial business combination within the required time period, our
public shareholders may receive only their pro rata portion of the funds in the trust account that are available for distribution to
public shareholders, and our warrants will expire worthless.
We
expect to encounter competition from other entities having a business objective similar to ours, including private investors (which may
be individuals or investment partnerships), other blank check companies and other entities, domestic and international, competing for
the types of businesses we intend to acquire. Many of these individuals and entities are well-established and have extensive experience
in identifying and effecting, directly or indirectly, acquisitions of companies operating in or providing services to various industries.
Many of these competitors possess similar or greater technical, human and other resources to ours or more local industry knowledge than
we do and our financial resources will be relatively limited when contrasted with those of many of these competitors. While we believe
there are numerous target businesses we could potentially acquire with the net proceeds from our IPO and the sale of the private placement
warrants, our ability to compete with respect to the acquisition of certain target businesses that are sizable will be limited by our
available financial resources. This inherent competitive limitation gives others an advantage in pursuing the acquisition of certain
target businesses. In addition, as our strategy is to focus on business combination targets in Latin America, where there is a more limited
pool of targets, we may be unable to find a suitable business combination target. Furthermore, we are obligated to offer holders of our
public shares the right to redeem their shares for cash at the time of our initial business combination in conjunction with a shareholder
vote or via a tender offer. Target companies will be aware that this may reduce the resources available to us for our initial business
combination. Any of these obligations may place us at a competitive disadvantage in successfully negotiating a business combination.
If we are unable to complete our initial business combination within the required time period, our public shareholders may receive only
their pro rata portion of the funds in the trust account that are available for distribution to public shareholders, and our warrants
will expire worthless.
The
ability of our public shareholders to redeem their shares for cash may make our financial condition unattractive to potential business
combination targets, which may make it difficult for us to enter into a business combination with a target.
We
may seek to enter into a business combination transaction agreement with a minimum cash requirement for (i) cash consideration to be
paid to the target or its owners, (ii) cash for working capital or other general corporate purposes or (iii) the retention of cash to
satisfy other conditions. If too many public shareholders exercise their redemption rights, we would not be able to meet such closing
condition and, as a result, would not be able to proceed with the business combination. The amount of the deferred underwriting commissions
payable to the underwriters will not be adjusted for any shares that are redeemed in connection with a business combination and such
amount of deferred underwriting discount is not available for us to use as consideration in an initial business combination. Furthermore,
in no event will we redeem our public shares in an amount that would cause our net tangible assets, after payment of the deferred underwriting
commissions, to be less than $5,000,001 upon completion of our initial business combination, or any greater net tangible asset or cash
requirement that may be contained in the agreement relating to our initial business combination. Consequently, if accepting all properly
submitted redemption requests would cause our net tangible assets, after payment of the deferred underwriting commissions, to be less
than $5,000,001 upon completion of our initial business combination or less than such greater amount necessary to satisfy a closing condition
as described above, we would not proceed with such redemption of our public shares and the related business combination, and we may instead
search for an alternate business combination. Prospective targets will be aware of these risks and, thus, may be reluctant to enter into
a business combination transaction with us.
If
we are able to consummate an initial business combination, the per-share value of shares held by non-redeeming shareholders will reflect
our obligation to pay the deferred underwriting commissions. The ability of our public shareholders to exercise redemption rights with
respect to a large number of our shares may not allow us to complete the most desirable business combination or optimize our capital
structure.
At
the time we enter into an agreement for our initial business combination, we will not know how many shareholders may exercise their redemption
rights, and therefore will need to structure the transaction based on our expectations as to the number of shares that will be submitted
for redemption. If our initial business combination agreement requires us to use a portion of the cash in the trust account to pay the
purchase price, or requires us to have a minimum amount of cash at closing, we will need to reserve a portion of the cash in the trust
account to meet such requirements, or arrange for third party financing. In addition, if a larger number of shares are submitted for
redemption than we initially expected, we may need to restructure the transaction to reserve a greater portion of the cash in the trust
account or arrange for third party financing. Raising additional third party financing may involve dilutive equity issuances or the incurrence
of indebtedness at higher than desirable levels. Furthermore, this dilution would increase to the extent that the anti-dilution provision
of the Class B ordinary shares results in the issuance of Class A ordinary shares on a greater than one-to-one basis upon conversion
of the Class B ordinary shares at the time of our initial business combination. In addition, the amount of the deferred underwriting
commissions payable to the underwriters will not be adjusted for any shares that are redeemed in connection with an initial business
combination. The per-share amount we will distribute to shareholders who properly exercise their redemption rights will not be reduced
by the deferred underwriting commission and after such redemptions, the amount held in trust will continue to reflect our obligation
to pay the entire deferred underwriting commissions. The above considerations may limit our ability to complete the most desirable business
combination available to us or optimize our capital structure.
The
ability of our public shareholders to exercise redemption rights with respect to a large number of our shares could increase the probability
that our initial business combination would be unsuccessful and that you would have to wait for liquidation in order to redeem your shares.
If
our initial business combination agreement requires us to use a portion of the cash in the trust account to pay the purchase price, or
requires us to have a minimum amount of cash at closing, the probability that our initial business combination would be unsuccessful
is increased. If our initial business combination is unsuccessful, you would not receive your pro rata portion of the trust account until
we liquidate the trust account. If you are in need of immediate liquidity, you could attempt to sell your shares in the open market;
however, at such time our shares may trade at a discount to the pro rata amount per share in the trust account. In either situation,
you may suffer a material loss on your investment or lose the benefit of funds expected in connection with your exercise of redemption
rights until we liquidate or you are able to sell your shares in the open market.
The
requirement that we complete our initial business combination within the prescribed time frame may give potential target businesses leverage
over us in negotiating a business combination and may limit the time we have in which to conduct due diligence on potential business
combination targets, in particular as we approach our dissolution deadline, which could undermine our ability to complete our initial
business combination on terms that would produce value for our shareholders.
Any
potential target business with which we enter into negotiations concerning a business combination will be aware that we must complete
our initial business combination by May 23, 2023 (or November 23, 2023 if we extend the period of time to consummate our initial business
combination in accordance with the terms described in our final prospectus). Consequently, such target business may obtain leverage over
us in negotiating a business combination, knowing that if we do not complete our initial business combination with that particular target
business, we may be unable to complete our initial business combination with any target business. This risk will increase as we get closer
to the timeframe described above. In addition, we may have limited time to conduct due diligence and may enter into our initial business
combination on terms that we would have rejected upon a more comprehensive investigation.
Our
sponsor may decide not to extend the term we have to consummate our initial business combination, in which case we would cease all operations
except for the purpose of winding up and we would redeem our public shares and liquidate.
Our
sponsor and its affiliates or permitted designees are not obligated to purchase private placement warrants to extend the time for us
to complete our initial business combination. If we have not consummated an initial business combination within such applicable time
period, we will: (i) cease all operations except for the purpose of winding up; (ii) as promptly as reasonably possible but not more
than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then
on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to
pay our income taxes, if any (less up to $100,000 of interest to pay dissolution expenses), divided by the number of the then-outstanding
public shares, which redemption will completely extinguish public shareholders’ rights as shareholders (including the right to
receive further liquidation distributions, if any); and (iii) as promptly as reasonably possible following such redemption, subject to
the approval of our remaining shareholders and our board of directors, liquidate and dissolve, subject in each case to our obligations
under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. Our amended and restated memorandum
and articles of association provides that, if we wind up for any other reason prior to the consummation of our initial business combination,
we will follow the foregoing procedures with respect to the liquidation of the trust account as promptly as reasonably possible but not
more than ten business days thereafter, subject to applicable Cayman Islands law. In either such case, our public shareholders may receive
only $10.20 per public share, or less than $10.20 per public share, on the redemption of their shares.
Our
search for a business combination, and any partner business with which we ultimately consummate a business combination, may be materially
adversely affected by the ongoing COVID-19 pandemic or any future pandemic and the status of debt and equity markets.
The
COVID-19 pandemic has resulted in, and a significant outbreak of other infectious diseases could result in, a widespread health crisis
that has adversely affected the economies and financial markets worldwide, and the business of any potential target business with which
we consummate a business combination could be materially and adversely affected.
Furthermore,
the continuing surges of COVID-19 cases, along with potential new strains and variants being discovered and challenges associated with
the roll out and availability of vaccines have resulted in the reimposition of certain restrictions in certain countries, particularly
in Latin America, and may lead to other restrictions being implemented in response to efforts to reduce the spread of COVID-19. We may
be unable to complete a business combination if concerns relating to COVID-19 continue to restrict travel, limit the ability to have
meetings with potential investors or the target company’s personnel, vendors and services providers are unavailable to negotiate
and consummate a transaction in a timely manner. The extent to which COVID-19 impacts our search for a business combination will depend
on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning the
severity of COVID-19 and the actions to contain COVID-19 or treat its impact, among others. If the disruptions posed by COVID-19 or other
matters of global concern continue for an extensive period of time, our ability to consummate a business combination, or the operations
of a target business with which we ultimately consummate a business combination, may be materially adversely affected.
In
addition, our ability to consummate a transaction may be dependent on the ability to raise equity and debt financing which may be impacted
by COVID-19 and other events, including as a result of increased market volatility, decreased market liquidity and third-party financing
being unavailable on terms acceptable to us or at all.
Finally,
the outbreak of COVID-19 may also have the effect of heightening many of the other risks described in this “Item 1A. Risk Factors”
section, such as those related to the market for our securities and cross-border transactions.
Our
initial business combination or reincorporation may result in taxes imposed on shareholders or warrant holders.
We
may effect a business combination with a target company in another jurisdiction, reincorporate in the jurisdiction in which the target
company or business is located, or reincorporate in another jurisdiction. Such transactions may result in tax liability for a stockholder
or warrant holder in the jurisdiction in which the shareholder or warrant holder is a tax resident (or in which its members are resident
if it is a tax transparent entity), in which the target company is located, or in which we reincorporate. In the event of a reincorporation
pursuant to our initial business combination, such tax liability may attach prior to any consummation of redemptions. We do not intend
to make any cash distributions to pay such taxes.
We
may reincorporate in another jurisdiction in connection with our initial business combination, and the laws of such jurisdiction may
govern some or all of our future material agreements and we may not be able to enforce our legal rights.
In
connection with our initial business combination, we may relocate the home jurisdiction of our business from the Cayman Islands to another
jurisdiction. If we determine to do this, the laws of such jurisdiction may govern some or all of our future material agreements. The
system of laws and the enforcement of existing laws in such jurisdiction may not be as certain in implementation and interpretation as
in the United States. The inability to enforce or obtain a remedy under any of our future agreements could result in a significant loss
of business, business opportunities or capital.
We may not be able to complete our initial business
combination within the prescribed time frame, in which case we would cease all operations except for the purpose of winding up and we
would redeem our public shares and liquidate.
We may not be able to find a suitable target business
and complete our initial business combination by May 23, 2023 (or November 23, 2023 if we extend the period of time to consummate our
initial business combination in accordance with the terms described in our final prospectus). Our ability to complete our initial business
combination may be negatively impacted by general market conditions, volatility in the capital and debt markets and the other risks described
herein. For example, the COVID-19 pandemic continues both in the U.S. and globally and, while the extent of the impact of the pandemic
on us will depend on future developments, it could limit our ability to complete our initial business combination, including as a result
of increased market volatility, decreased market liquidity and third-party financing being unavailable on terms acceptable to us or at
all. Additionally, the COVID-19 pandemic may negatively impact businesses we may seek to acquire. If we have not completed our initial
business combination within such time period, we will: (i) cease all operations except for the purpose of winding up, (ii) as
promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable
in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust
account and not previously released to us to pay our taxes (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 shareholders’ rights as shareholders
(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 shareholders and our board of directors, liquidate and dissolve, subject in
each case, to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law.
If we are unable to consummate our initial business
combination within the prescribed time frame, our public shareholders may be forced to wait beyond such time frame before redemption from
our trust account.
If we are unable to consummate our initial business
combination by May 23, 2023 (or November 23, 2023 if we extend the period of time to consummate our initial business combination in accordance
with the terms described in our final prospectus), the funds 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 income to pay dissolution
expenses), will be used to fund the redemption of our public shares, as further described herein. Any redemption of public shareholders
from the trust account will be effected automatically by function of our amended and restated memorandum and articles of association prior
to any voluntary winding up. If we are required to wind-up or liquidate the trust account and distribute such amount therein, pro rata,
to our public shareholders, as part of any liquidation process, such winding up, liquidation and distribution must comply with the applicable
provisions of the Companies Act. In that case, investors may be forced to wait beyond May 23, 2023 (or November 23, 2023 if we extend
the period of time to consummate our initial business combination in accordance with the terms described in our final prospectus) before
the redemption proceeds of our trust account become available to them, and they receive the return of their pro rata portion of the funds
from our trust account. We have no obligation to return funds to investors prior to the date of our redemption or liquidation unless we
consummate our initial business combination prior thereto and only then in cases where investors have sought to redeem their Class A ordinary
shares. Only upon our redemption or any liquidation will public shareholders be entitled to distributions if we are unable to complete
our initial business combination.
If we seek shareholder approval of our initial
business combination, our initial shareholders and management team have agreed to vote in favor of such initial business combination,
regardless of how our public shareholders vote.
Our initial shareholders own approximately 25%
of our issued and outstanding ordinary shares as of December 31, 2021. Our initial shareholders and management team also may from time
to time purchase Class A ordinary shares prior to our initial business combination. Our amended and restated memorandum and articles of
association provide that, if we seek shareholder approval of an initial business combination, such initial business combination will be
approved if we receive an ordinary resolution under Cayman Islands law, which requires the affirmative vote of a majority of the shareholders
who attend and vote at a general meeting of the company, including the founder shares. As a result, in addition to our initial shareholders’
founder shares, we would need 6,708,334, or 33.3%, of the 20,125,000 public shares sold in our IPO to be voted in favor of an initial
business combination in order to have our initial business combination approved. Accordingly, if we seek shareholder approval of our initial
business combination, the agreement by our initial shareholders and management team to vote in favor of our initial business combination
will increase the likelihood that we will receive an ordinary resolution, being the requisite shareholder approval for such initial business
combination.
If we seek shareholder approval of our initial
business combination, our sponsor, our other initial shareholders, directors, officers, advisors and their respective affiliates may elect
to purchase shares or public warrants from public shareholders, which may influence a vote on a proposed business combination and reduce
the public “float” of our Class A ordinary shares.
If we seek shareholder approval of our initial
business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer
rules, our sponsor, initial shareholders, directors, officers, advisors or their affiliates may purchase public shares or public warrants
in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination,
although they are under no obligation to do so. There is no limit on the number of shares our initial shareholders, directors, officers,
advisors or their affiliates may purchase in such transactions, subject to compliance with applicable law and Nasdaq rules. Additionally,
at any time at or prior to our initial business combination, subject to applicable securities laws (including with respect to material
non-public information), our initial shareholders, directors, officers, advisors or their affiliates may enter into transactions with
investors and others to provide them with incentives to acquire public shares, vote their public shares in favor of our initial business
combination or not redeem their public shares. However, they have no current commitments, plans or intentions to engage in such transactions
and have not formulated any terms or conditions for any such transactions. None of the funds in the trust account will be used to purchase
shares or public warrants in such transactions. Such purchases may include a contractual acknowledgment that such shareholder, although
still the record holder of our shares, is no longer the beneficial owner thereof and therefore agrees not to exercise its redemption rights.
In the event that our sponsor, initial shareholders,
directors, officers, advisors or their affiliates purchase shares in privately negotiated transactions from public shareholders who have
already elected to exercise their redemption rights, such selling shareholders would be required to revoke their prior elections to redeem
their shares. The purpose of any such purchases of shares could be to vote such shares in favor of the business combination and thereby
increase the likelihood of obtaining shareholder approval of the business combination or to satisfy a closing condition in an agreement
with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination,
where it appears that such requirement would otherwise not be met. The purpose of any such purchases of public warrants could be to reduce
the number of public warrants outstanding or to vote such warrants on any matters submitted to the warrant holders for approval in connection
with our initial business combination. Any such purchases of our securities may result in the completion of our initial business combination
that may not otherwise have been possible. Any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act
to the extent such purchasers are subject to such reporting requirements. See “Item 1. Business—Effecting Our Initial Business
Combination—Permitted Purchases of Our Securities” for a description of how our sponsor, directors, officers, advisors or
any of their affiliates will select which shareholders to purchase securities from in any private transaction. In addition, if such purchases
are made, the public “float” of our Class A ordinary shares or public warrants and the number of beneficial holders of our
securities may be reduced, possibly making it difficult to obtain or maintain the quotation, listing or trading of our securities on a
national securities exchange.
If a shareholder fails to receive notice of
our offer to redeem our public shares in connection with our initial business combination, or fails to comply with the procedures for
tendering its shares, such shares may not be redeemed.
We will comply with the proxy rules or tender
offer rules, as applicable, when conducting redemptions in connection with our initial business combination. Despite our compliance with
these rules, if a shareholder fails to receive our proxy materials or tender offer documents, as applicable, such shareholder may not
become aware of the opportunity to redeem its shares. In addition, proxy materials or tender offer documents, as applicable, that we will
furnish to holders of our public shares in connection with our initial business combination will describe the various procedures that
must be complied with in order to validly tender or submit public shares for redemption. For example, we intend to require our public
shareholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in “street name,”
to, at the holder’s option, either deliver their stock certificates to our transfer agent, or to deliver their shares to our transfer
agent electronically prior to the date set forth in the proxy materials or tender offer documents, as applicable. In the case of proxy
materials, this date may be up to two business days prior to the date on which the vote on the proposal to approve the initial business
combination is to be held. In addition, if we conduct redemptions in connection with a shareholder vote, we intend to require a public
shareholder seeking redemption of its public shares to also submit a written request for redemption to our transfer agent two business
days prior to the scheduled vote in which the name of the beneficial owner of such shares is included. In the event that a shareholder
fails to comply with these or any other procedures disclosed in the proxy or tender offer materials, as applicable, its shares may not
be redeemed. See the section of this annual report entitled “Item 1. Business—Effecting Our Initial Business Combination—Delivering
Share Certificates in Connection with the Exercise of Redemption Rights.”
We may be unable to obtain additional financing
to complete our initial business combination or to fund the operations and growth of a target business, which could compel us to restructure
or abandon a particular business combination.
We have not selected any specific business combination
target but intend to target businesses with enterprise values that are greater than we could acquire with the net proceeds from our IPO
and the sale of the private placement warrants. As a result, if the cash portion of the purchase price exceeds the amount available from
the trust account, net of amounts needed to satisfy any redemption by public shareholders, we may be required to seek additional financing
to complete such proposed initial business combination. We cannot assure you that such financing will be available on acceptable terms,
if at all. The current economic environment may make it difficult for companies to obtain acquisition financing. To the extent that additional
financing proves to be unavailable when needed to complete our initial business combination, we would be compelled to either restructure
the transaction or abandon that particular business combination and seek an alternative target business candidate. Further, we may be
required to obtain additional financing in connection with the closing of our initial business combination for general corporate purposes,
including for maintenance or expansion of operations of the post-business combination businesses, the payment of principal or interest
due on indebtedness incurred in completing our initial business combination, or to fund the purchase of other companies. If we are unable
to complete our initial business combination, our public shareholders may only receive their pro rata portion of the funds in the trust
account that are available for distribution to public shareholders, and our warrants will expire worthless. In addition, even if we do
not need additional financing to complete our initial business combination, we may require such financing to fund the operations or growth
of the target business. The failure to secure additional financing could have a material adverse effect on the continued development or
growth of the target business. None of our officers, directors, advisors or shareholders is required to provide any financing to us in
connection with or after our initial business combination. Other than in connection with a forward purchase agreement we may enter into,
none of our officers, directors or shareholders is required to provide any financing to us in connection with or after our initial business
combination.
Although we have identified general criteria
and guidelines that we believe are important in evaluating prospective target businesses, we may enter into our initial business combination
with a target that does not meet such criteria and guidelines, and as a result, the target business with which we enter into our initial
business combination may not have attributes entirely consistent with our general criteria and guidelines.
Although we have identified general criteria and
guidelines, including geographic area, for evaluating prospective target businesses, it is possible that a target business with which
we enter into our initial business combination will not have all of these positive attributes. If we complete our initial business combination
with a target that does not meet some or all of these guidelines, such combination may not be as successful as a combination with a business
that does meet all of our general criteria and guidelines. In addition, if we announce a prospective business combination with a target
that does not meet our general criteria and guidelines, a greater number of shareholders may exercise their redemption rights, which may
make it difficult for us to meet any closing condition with a target business that requires us to have a minimum net worth or a certain
amount of cash. In addition, if shareholder approval of the transaction is required by law, or we decide to obtain shareholder approval
for business or other reasons, it may be more difficult for us to attain shareholder approval of our initial business combination if the
target business does not meet our general criteria and guidelines. If we are unable to complete our initial business combination, our
public shareholders may only receive their pro rata portion of the funds in the trust account that are available for distribution to public
shareholders, and our warrants will expire worthless.
We may seek business combination opportunities
in industries or sectors that may be outside of our management’s areas of expertise.
We may consider a business combination outside
of our management’s areas of expertise if a business combination candidate is presented to us and we determine that such candidate
offers an attractive business combination opportunity for our company. Although our management will endeavor to evaluate the risks inherent
in any particular business combination candidate, we cannot assure you that we will adequately ascertain or assess all of the significant
risk factors. We also cannot assure you that an investment in our units will not ultimately prove to be less favorable than a direct investment,
if an opportunity were available, in a business combination candidate. In the event we elect to pursue a business combination outside
of the areas of our management’s expertise, our management’s expertise may not be directly applicable to its evaluation or
operation, and the information contained in this annual report regarding the areas of our management’s expertise would not be relevant
to an understanding of the business that we elect to acquire. As a result, our management may not be able to ascertain or assess adequately
all of the relevant risk factors. Accordingly, any shareholders who choose to remain shareholders following our initial business combination
could suffer a reduction in the value of their shares. Such shareholders are unlikely to have a remedy for such reduction in value.
Resources could be wasted in researching business
combinations that are not completed, which could materially adversely affect subsequent attempts to locate and acquire or merge with another
business. If we are unable to complete our initial business combination, our public shareholders may only receive their pro rata portion
of the funds in the trust account that are available for distribution to public shareholders, and our warrants will expire worthless.
We anticipate that the investigation of each specific
target business and the negotiation, drafting and execution of relevant agreements, disclosure documents and other instruments will require
substantial management time and attention and substantial costs for accountants, attorneys, consultants and others. If we decide not to
complete a specific initial business combination, the costs incurred up to that point for the proposed transaction likely would not be
recoverable. Furthermore, if we reach an agreement relating to a specific target business, we may fail to complete our initial business
combination for any number of reasons including those beyond our control. Any such event will result in a loss to us of the related costs
incurred which could materially adversely affect subsequent attempts to locate and acquire or merge with another business. If we are unable
to complete our initial business combination, our public shareholders may only receive their pro rata portion of the funds in the trust
account that are available for distribution to public shareholders, and our warrants will expire worthless.
We may have a limited ability to assess the
management of a prospective target business and, as a result, may effect our initial business combination with a target business whose
management may not have the skills, qualifications or abilities to manage a public company.
When evaluating the desirability of effecting
our initial business combination with a prospective target business, our ability to assess the target business’s management may
be limited due to a lack of time, resources or information. Our assessment of the capabilities of the target business’s management,
therefore, may prove to be incorrect and such management may lack the skills, qualifications or abilities we suspected. Should the target
business’s management not possess the skills, qualifications or abilities necessary to manage a public company, the operations and
profitability of the post-combination business may be negatively impacted. Accordingly, any shareholders or warrant holders who choose
to remain shareholders or warrant holders following the business combination could suffer a reduction in the value of their securities.
Such shareholders or warrant holders are unlikely to have a remedy for such reduction in value unless they are able to successfully claim
that the reduction was due to the breach by our officers or directors of a duty of care or other fiduciary duty owed to them, or if they
are able to successfully bring a private claim under securities laws that the proxy solicitation or tender offer materials, as applicable,
relating to the business combination contained an actionable material misstatement or material omission.
We may seek business combination opportunities
with a financially unstable business or an entity lacking an established record of revenue, cash flow, or earnings, which could subject
us to volatile revenues or earnings or difficulty in retaining key personnel.
To the extent we complete our initial business
combination with a financially unstable business or an entity lacking an established record of revenues or earnings, we may be affected
by numerous risks inherent in the operations of the business with which we combine. These risks include investing in a business without
a proven business model and with limited historical financial data, volatile revenues or earnings, intense competition and difficulties
in obtaining and retaining key personnel. Although our directors and officers will endeavor to evaluate the risks inherent in a particular
target business, we may not be able to properly ascertain or assess all of the significant risk factors and we may not have adequate time
to complete due diligence. Furthermore, some of these risks may be outside of our control and leave us with no ability to control or reduce
the chances that those risks will adversely impact a target business.
Moreover, in pursuing our business combination
strategy, we may seek to effectuate our initial business combination with a privately held company. Very little public information generally
exists about private companies, and we could be required to make our decision on whether to pursue a potential initial business combination
on the basis of limited information, which may result in a business combination with a company that is not as profitable (if at all) as
we believed at the time of signing an agreement to acquire such private company or that fails to meet the projections upon which our valuation
may be based.
We may attempt to complete our initial business
combination with a private company about which little information is available, which may result in a business combination with a company
that is not as profitable as we suspected, if at all.
In pursuing our business combination strategy,
we may seek to effectuate our initial business combination with a privately held company. Very little public information generally exists
about private companies, and we could be required to make our decision on whether to pursue a potential initial business combination on
the basis of limited information, which may result in a business combination with a company that is not as profitable as we suspected,
if at all.
The officers and directors of an acquisition
candidate may resign upon completion of our initial business combination. The loss of a business combination target’s key personnel
could negatively impact the operations and profitability of our post-combination business.
The role of an acquisition candidate’s key
personnel upon the completion of our initial business combination cannot be ascertained at this time. Although we contemplate that certain
members of an acquisition candidate’s management team will remain associated with the acquisition candidate following our initial
business combination, it is possible that members of the management of an acquisition candidate will not wish to remain in place.
Since our sponsor, officers and directors will
lose their entire investment in us if our initial business combination is not completed (other than with respect to public shares they
may acquire during or after our IPO), a conflict of interest may arise in determining whether a particular business combination target
is appropriate for our initial business combination.
In March 2021, one of our officers paid $25,000,
or approximately $0.004 per share, to cover certain of our offering costs, in exchange for an aggregate of 5,750,000 founder shares, which
were temporarily issued to such officer and, on April 7, 2021, transferred to our sponsor. The purchase price of the founder shares was
determined by dividing the amount of expenses paid on behalf of the company by the number of founder shares issued. In October 2021, our
sponsor received a further 958,333 founder shares by way of share capitalization using the existing share premium account. The number
of founder shares outstanding was determined based on our IPO of 20,125,000 and therefore the corresponding 6,708,333 founder shares represent
approximately 25% of the outstanding shares. Out of the 6,708,333 founder shares, 5,031,250 founder shares will convert into Class A ordinary
shares after our initial business combination and 1,677,083 founder shares will convert into Class A ordinary shares only to the extent
our stock trades at or above $12.50 per share as described in the final prospectus. The founder shares will be worthless if we do not
complete an initial business combination. In addition, our sponsor has purchased an aggregate of 10,150,000 private placement
warrants for an aggregate purchase price of $10,150,000, or $1.00 per warrant. The private placement warrants will also be worthless if
we do not complete our initial business combination. The personal and financial interests of our officers and directors may influence
their motivation in identifying and selecting a target business combination, completing an initial business combination and influencing
the operation of the business following the initial business combination. This risk may become more acute as May 23, 2023 (or November
23, 2023 if we extend the period of time to consummate our initial business combination in accordance with the terms described in our
final prospectus), which is the deadline for our completion of an initial business combination.
Because we must furnish our shareholders with
target business financial statements, we may lose the ability to complete an otherwise advantageous initial business combination with
some prospective target businesses.
The federal proxy rules require that the proxy
statement with respect to the vote on an initial business combination include historical and pro forma financial statement disclosure.
We will include the same financial statement disclosure in connection with our tender offer documents, whether or not they are required
under the tender offer rules. These financial statements may be required to be prepared in accordance with, or be reconciled to, accounting
principles generally accepted in the United States of America, or “GAAP,” or international financial reporting standards as
issued by the International Accounting Standards Board, or “IFRS,” depending on the circumstances and the historical financial
statements may be required to be audited in accordance with the standards of the PCAOB. These financial statement requirements may limit
the pool of potential target businesses we may acquire because some targets may be unable to provide such financial statements in time
for us to disclose such statements in accordance with federal proxy rules and complete our initial business combination within the prescribed
time frame.
If the net proceeds from our IPO and the sale
of the private placement warrants not being held in the trust account are insufficient to allow us to operate for at least until May 23,
2023 (or November 23, 2023 if we extend the period of time to consummate our initial business combination in accordance with the terms
described in our final prospectus), it could limit the amount available to fund our search for a target business or businesses and complete
our initial business combination, and we will depend on loans from our sponsor or management team to fund our search and to complete our
initial business combination.
Of the net proceeds from our IPO, only $1,450,000
was available to us initially outside the trust account to fund our working capital requirements. We believe that these funds available
to us outside of the trust account will be sufficient to allow us to operate until November 23, 2023; however, we cannot assure you that
our estimate is accurate, and our sponsor, its affiliates and members of our management team are under no obligation to advance funds
to us in the event that the funds available to us outside of the trust account are subsequently determined to be insufficient. Of the
funds available to us, we could use a portion of the funds available to us to pay fees to consultants to assist us with our search for
a target business. We could also use a portion of the funds as a down payment or to fund a “no-shop” provision (a provision
in letters of intent or merger agreements designed to keep target businesses from “shopping” around for transactions with
other companies or investors on terms more favorable to such target businesses) with respect to a particular proposed business combination,
although we do not have any current intention to do so. If we entered into a letter of intent or merger agreement where we paid for the
right to receive exclusivity from a target business and were subsequently required to forfeit such funds (whether as a result of our breach
or otherwise), we might not have sufficient funds to continue searching for, or conduct due diligence with respect to, a target business.
In the event that our offering expenses exceed
our estimate of $650,000, we may fund such excess with funds not to be held in the trust account. In such case, the amount of funds we
intend to be held outside the trust account would decrease by a corresponding amount. The amount held in the trust account will not be
impacted as a result of such increase or decrease. Conversely, in the event that the offering expenses are less than our estimate of $650,000,
the amount of funds we intend to be held outside the trust account would increase by a corresponding amount. If we are required to seek
additional capital, we would need to borrow funds from our sponsor, management team or other third parties to operate or may be forced
to liquidate. Neither our sponsor, members of our management team nor any of their affiliates is under any obligation to advance funds
to us in such circumstances. Any such advances would be repaid only from funds held outside the trust account or from funds released to
us upon completion of our initial business combination. Up to $2,100,000 of such loans may be convertible into private placement warrants
of the post-business combination entity at a price of $1.00 per warrant at the option of the lender. Such warrants would be identical
to the private placement warrants. Prior to the completion of our initial business combination, we do not expect to seek loans from parties
other than our sponsor or an affiliate of our sponsor as we do not believe third parties will be willing to loan such funds and provide
a waiver against any and all rights to seek access to funds in our trust account. If we are unable to complete our initial business combination
because we do not have sufficient funds available to us, we will be forced to cease operations and liquidate the trust account. Consequently,
our public shareholders may only receive an estimated $10.20 per unit, or possibly less, on our redemption of our public shares, and our
warrants will expire worthless.
Subsequent to our completion of our initial
business combination, we may be required to take write-downs or write-offs, restructuring and impairment or other charges that could have
a significant negative effect on our financial condition, results of operations and the price of our securities, which could cause you
to lose some or all of your investment.
Even if we conduct due diligence on a target business
with which we combine, we cannot assure you that this diligence will identify all material issues that may be present within a particular
target business, that it would be possible to uncover all material issues through a customary amount of due diligence, or that factors
outside of the target business and outside of our control will not later arise. As a result of these factors, we may be forced to later
write-down or write-off assets, restructure our operations, or incur impairment or other charges that could result in our reporting losses.
Even if our due diligence successfully identifies certain risks, unexpected risks may arise and previously known risks may materialize
in a manner not consistent with our preliminary risk analysis. Even though these charges may be non-cash items and not have an immediate
impact on our liquidity, the fact that we report charges of this nature could contribute to negative market perceptions about us or our
securities. In addition, charges of this nature may cause us to violate net worth or other covenants to which we may be subject as a result
of assuming pre-existing debt held by a target business or by virtue of our obtaining debt financing to partially finance the initial
business combination or thereafter. Accordingly, any shareholders or warrant holders who choose to remain shareholders or warrant holders
following the business combination could suffer a reduction in the value of their securities. Such shareholders or warrant holders are
unlikely to have a remedy for such reduction in value unless they are able to successfully claim that the reduction was due to the breach
by our officers or directors of a duty of care or other fiduciary duty owed to them, or if they are able to successfully bring a private
claim under securities laws that the proxy solicitation or tender offer materials, as applicable, relating to the business combination
contained an actionable material misstatement or material omission.
If third parties bring claims against us, the
funds held in the trust account could be reduced and the per-share redemption amount received by shareholders may be less than $10.20
per unit.
Our placing of funds in the trust account may
not protect those funds from third party claims against us. Although we will seek to have all vendors, service providers, prospective
target businesses and other entities with which we do business execute agreements with us waiving any right, title, interest or claim
of any kind in or to any monies held in the trust account for the benefit of our public shareholders, such parties may not execute such
agreements, or even if they execute such agreements they may not be prevented from bringing claims against the trust account, including,
but not limited to, fraudulent inducement, breach of fiduciary responsibility or other similar claims, as well as claims challenging the
enforceability of the waiver, in each case in order to gain advantage with respect to a claim against our assets, including the funds
held in the trust account. If any third party refuses to execute an agreement waiving such claims to the monies held in the trust account,
our management will consider whether competitive alternatives are reasonably available to us and will only enter into an agreement with
such third party if management believes that such third party’s engagement would be in the best interests of the company under the
circumstances. Marcum LLP, our independent registered public accounting firm, and the underwriters of our IPO will not execute agreements
with us waiving such claims to the monies held in the trust account.
Examples of possible instances where we may engage
a third party that refuses to execute a waiver include the engagement of a third-party consultant whose particular expertise or skills
are believed by management to be significantly superior to those of other consultants that would agree to execute a waiver or in cases
where management is unable to find a service provider willing to execute a waiver. In addition, there is no guarantee that such entities
will agree to waive any claims they may have in the future as a result of, or arising out of, any negotiations, contracts or agreements
with us and will not seek recourse against the trust account for any reason. Upon redemption of our public shares, if we have not completed
our initial business combination within the prescribed timeframe, or upon the exercise of a redemption right in connection with our initial
business combination, we will be required to provide for payment of claims of creditors that were not waived that may be brought against
us within the 10 years following redemption. Accordingly, the per-share redemption amount received by public shareholders could be less
than the $10.20 per unit initially held in the trust account, due to claims of such creditors. Pursuant to the letter agreement included
as an exhibit to the registration statement for our IPO, our sponsor has agreed that it will be liable to us if and to the extent any
claims by a third party (other than Marcum LLP, our independent registered public accounting firm) for services rendered or products sold
to us, or a prospective target business with which we have entered into a written letter of intent, confidentiality or other similar agreement
or business combination agreement, reduce the amount of funds in the trust account to below the lesser of (i) $10.20 per unit and (ii) the
actual amount per unit held in the trust account as of the date of the liquidation of the trust account, if less than $10.20 per unit
due to reductions in the value of the trust assets, less taxes payable, provided that such liability will not apply to any claims by a
third party or prospective target business who executed a waiver of any and all rights to the monies held in the trust account (whether
or not such waiver is enforceable) nor will it apply to any claims under our indemnity of the underwriters of our IPO against certain
liabilities, including liabilities under the Securities Act. However, we have not asked our sponsor to reserve for such indemnification
obligations, nor have we independently verified whether our sponsor has sufficient funds to satisfy its indemnity obligations and we believe
that our sponsor’s only assets are securities of our company. Therefore, we cannot assure you that our sponsor would be able to
satisfy those obligations. As a result, if any such claims were successfully made against the trust account, the funds available for our
initial business combination and redemptions could be reduced to less than $10.20 per unit. In such event, we may not be able to complete
our initial business combination, and you would receive such lesser amount per share in connection with any redemption of your public
shares. None of our officers or directors will indemnify us for claims by third parties including, without limitation, claims by vendors
and prospective target businesses.
Our directors may decide not to enforce the
indemnification obligations of our sponsor, resulting in a reduction in the amount of funds in the trust account available for distribution
to our public shareholders.
In the event that the funds in the trust account
are reduced below the lesser of (i) $10.20 per unit and (ii) the actual amount per public share held in the trust account as
of the date of the liquidation of the trust account if less than $10.20 per unit due to reductions in the value of the trust assets, in
each case less taxes payable, and our sponsor asserts that it is unable to satisfy his obligations or that he 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 we currently expect that our independent directors would take legal action on our behalf against our
sponsor to enforce its indemnification obligations to us, it is possible that our independent directors in exercising their business judgment
and subject to their fiduciary duties may choose not to do so in any particular instance if, for example, the cost of such legal action
is deemed by the independent directors to be too high relative to the amount recoverable or if the independent directors determine that
a favorable outcome is not likely. If our independent directors choose not to enforce these indemnification obligations, the amount of
funds in the trust account available for distribution to our public shareholders may be reduced below $10.20 per unit.
The securities in which we invest the funds
held in the trust account could bear a negative rate of interest, which could reduce the value of the assets held in trust such that the
per share redemption amount received by public shareholders may be less than $10.20 per unit.
The proceeds held in the trust account will be
invested only in U.S. government treasury obligations with a maturity of 185 days or less or in money market funds meeting certain conditions
under Rule 2a-7 under the Investment Company Act, which invest only in direct U.S. government treasury obligations. While short-term U.S.
government treasury obligations currently yield a positive rate of interest, they have briefly yielded negative interest rates in recent
years. Central banks in Europe and Japan pursued interest rates below zero in recent years, and the Open Market Committee of the Federal
Reserve has not ruled out the possibility that it may in the future adopt similar policies in the United States. In the event that we
do not to complete our initial business combination or make certain amendments to our amended and restated memorandum and articles of
association, our public shareholders are entitled to receive their pro-rata share of the proceeds held in the trust account, plus any
interest income earned thereon and not previously released to us to pay our taxes (less up to $100,000 of interest income to pay dissolution
expenses). Negative interest rates could reduce the value of the assets held in trust such that the per-share redemption amount received
by public shareholders may be less than $10.20 per unit.
If, after we distribute the funds in the trust
account to our public shareholders, we file a bankruptcy or winding-up petition or an involuntary bankruptcy or winding-up petition is
filed against us that is not dismissed, a bankruptcy or insolvency court may seek to recover such proceeds, and the members of our board
of directors may be viewed as having breached their fiduciary duties to our creditors, thereby exposing the members of our board of directors
and us to claims of punitive damages.
If, after we distribute the funds in the trust
account to our public shareholders, we file a bankruptcy or winding-up petition or an involuntary bankruptcy or winding-up petition is
filed against us that is not dismissed, any distributions received by shareholders could be viewed under applicable debtor/creditor and/or
bankruptcy or insolvency laws as either a “preferential transfer” or a “fraudulent conveyance.” As a result, a
bankruptcy or insolvency court could seek to recover some or all amounts received by our shareholders. In addition, our board of directors
may be viewed as having breached its fiduciary duty to our creditors and/or having acted in bad faith, thereby exposing itself and us
to claims of punitive damages, by paying public shareholders from the trust account prior to addressing the claims of creditors.
If, before distributing the funds in the trust account to our public shareholders, we file a bankruptcy or winding-up petition or an involuntary
bankruptcy or winding-up petition is filed against us that is not dismissed, the claims of creditors in such proceeding may have priority
over the claims of our shareholders and the per-share amount that would otherwise be received by our shareholders in connection with our
liquidation may be reduced.
If, before distributing the funds in the trust
account to our public shareholders, we file a bankruptcy or winding-up petition or an involuntary bankruptcy or winding-up petition is
filed against us that is not dismissed, the funds held in the trust account could be subject to applicable bankruptcy or insolvency law,
and may be included in our bankruptcy estate and subject to the claims of third parties with priority over the claims of our shareholders.
To the extent any bankruptcy claims deplete the trust account, the per-share amount that would otherwise be received by our shareholders
in connection with our liquidation may be reduced.
You will not be permitted to exercise your warrants
unless we register and qualify the underlying Class A ordinary shares or certain exemptions are available.
If the issuance of the Class A ordinary shares
upon exercise of the warrants is not registered, qualified or exempt from registration or qualification under the Securities Act and applicable
state securities laws, holders of warrants will not be entitled to exercise such warrants and such warrants may have no value and expire
worthless. In such event, holders who acquired their warrants as part of a purchase of units will have paid the full unit purchase price
solely for the Class A ordinary shares included in the units.
We have not registered, and will not register,
the Class A ordinary shares issuable upon exercise of the warrants under the Securities Act or any state securities laws at this time.
However, under the terms of the warrant agreement, we have agreed that, as soon as practicable, but in no event later than 15 business
days, after the closing of our initial business combination, we will use our commercially reasonable efforts to file with the SEC a registration
statement covering the registration under the Securities Act of the Class A ordinary shares issuable upon exercise of the warrants and
thereafter will use our commercially reasonable efforts to cause the same to become effective within 60 business days following our initial
business combination and to maintain a current prospectus relating to the Class A ordinary shares issuable upon exercise of the warrants
until the expiration or redemption of the warrants in accordance with the provisions of the warrant agreement. We cannot assure you that
we will be able to do so if, for example, any facts or events arise which represent a fundamental change in the information set forth
in the registration statement or prospectus, the financial statements contained or incorporated by reference therein are not current or
correct or the SEC issues a stop order.
If the Class A ordinary shares issuable upon exercise
of the warrants are not registered under the Securities Act, under the terms of the warrant agreement, holders of warrants who seek to
exercise their warrants will not be permitted to do so for cash and, instead, will be required to do so on a cashless basis, in which
case the number of Class A ordinary shares that the holders of warrants will receive upon cashless exercise will be based on a formula
subject to a maximum number of shares equal to 0.361 Class A ordinary shares per warrant (subject to adjustment).
In no event will warrants be exercisable for cash
or on a cashless basis, and we will not be obligated to issue any shares to holders seeking to exercise their warrants, unless the issuance
of the shares upon such exercise is registered or qualified under the securities laws of the state of the exercising holder, or an exemption
from registration or qualification is available.
If our Class A ordinary shares are at the time
of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of “covered securities”
under Section 18(b)(1) of the Securities Act, we may, at our option, not permit holders of warrants who seek to exercise their warrants
to do so for cash and, instead, require them to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act; in
the event we so elect, we will not be required to file or maintain in effect a registration statement or register or qualify the shares
underlying the warrants under applicable state securities laws, and in the event we do not so elect, we will use our commercially reasonable
efforts to register or qualify the shares underlying the warrants under applicable state securities laws to the extent an exemption is
not available.
In no event will we be required to net cash settle
any warrant, or issue securities (other than upon a cashless exercise as described above) or other compensation in exchange for the warrants
in the event that we are unable to register or qualify the shares underlying the warrants under the Securities Act or applicable state
securities laws.
Our shareholders may be held liable for claims
by third parties against us to the extent of distributions received by them upon redemption of their shares.
If we are forced to enter into an insolvent liquidation,
any distributions received by shareholders could be viewed as an unlawful payment if it was proved that immediately following the date
on which the distribution was made, we were unable to pay our debts as they fall due in the ordinary course of business. As a result,
a liquidator could seek to recover some or all amounts received by our shareholders. Furthermore, our directors may be viewed as having
breached their fiduciary duties to us or our creditors and/or may have acted in bad faith, thereby exposing themselves and our company
to claims, by paying public shareholders from the trust account prior to addressing the claims of creditors. We cannot assure you that
claims will not be brought against us for these reasons. We and our directors and officers who knowingly and willfully authorized or permitted
any distribution to be paid out of our share premium account while we were unable to pay our debts as they fall due in the ordinary course
of business would be guilty of an offence and may be liable for a fine of $18,293 and to imprisonment for five years in the Cayman Islands.
We may not hold an annual general meeting until
after the consummation of our initial business combination, which could delay the opportunity for our shareholders to appoint directors.
In accordance with Nasdaq corporate governance
requirements, we are required to hold an annual general meeting no later than one year after our first fiscal year end following our listing
on Nasdaq. There is no requirement under the Companies Act for us to hold annual or extraordinary general meetings to appoint directors.
Until we hold an annual general meeting, public shareholders may not be afforded the opportunity to appoint directors and to discuss company
affairs with management. Our board of directors is divided into three classes with only one class of directors being appointed in each
year and each class (except for those directors appointed prior to our first general meeting) serving a three-year term. In addition,
as holders of our Class A ordinary shares, our public shareholders will not have the right to vote on the appointment of directors until
after the consummation of our initial business combination. In addition, as holders of our Class A ordinary shares, our public shareholders
will not have the right to vote on the appointment of directors until after the consummation of our initial business combination.
Because we are neither limited to evaluating
a target business in a particular industry sector nor have we selected any target businesses with which to pursue our initial business
combination, you will be unable to ascertain the merits or risks of any particular target business’s operations.
Although we expect to invest in a Brazilian company,
our efforts to identify a prospective initial business combination target will not be limited to a particular industry, sector or geographic
region in Latin America. While we may pursue an initial business combination opportunity in any industry or sector, we intend to capitalize
on the ability of our management team to identify and acquire a business or businesses that can benefit from our management team’s
established global relationships and operating experience. Our management team has extensive experience in strategy and finance, including
companies in sectors with strong growth potential benefiting from positive trends in the region, including, but not limited to, healthcare,
technology, education services, consumer and retail. Our amended and restated memorandum and articles of association prohibit us from
effectuating a business combination with another blank check company or similar company with nominal operations. Because we have not yet
selected or approached any specific target business with respect to a business combination, there is no basis to evaluate the possible
merits or risks of any particular target business’s operations, results of operations, cash flows, liquidity, financial condition
or prospects. To the extent we complete our initial business combination, we may be affected by numerous risks inherent in the business
operations with which we combine. For example, if we combine with a financially unstable business or an entity lacking an established
record of sales or earnings, we may be affected by the risks inherent in the business and operations of a financially unstable or a development
stage entity. Although our officers and directors will endeavor to evaluate the risks inherent in a particular target business, we cannot
assure you that we will properly ascertain or assess all of the significant risk factors or that we will have adequate time to complete
due diligence. Furthermore, some of these risks may be outside of our control and leave us with no ability to control or reduce the chances
that those risks will adversely impact a target business. We also cannot assure you that an investment in our units will ultimately prove
to be more favorable to investors than a direct investment, if such opportunity were available, in a business combination target. Accordingly,
any shareholders who choose to remain shareholders following the business combination could suffer a reduction in the value of their securities.
Such shareholders are unlikely to have a remedy for such reduction in value unless they are able to successfully claim that the reduction
was due to the breach by our officers or directors of a duty of care or other fiduciary duty owed to them, or if they are able to successfully
bring a private claim under securities laws that the proxy solicitation or tender offer materials, as applicable, relating to the business
combination contained an actionable material misstatement or material omission.
If we consider an initial business combination
with an affiliated entity or if our board of directors is not able to independently determine the fair market value of the target business,
such transaction would be subject to approval by a majority of our independent and disinterested directors. We would not be required to
obtain an opinion from a third party firm in such event to address whether the business combination is fair to our public shareholders
from a financial point of view, and consequently, you may have no assurance from an independent source that the price we are paying for
the business is fair to our shareholders from a financial point of view.
If our board of directors is not able to independently
determine the fair market value of the target business or businesses, or if we are considering an initial business combination with an
affiliated entity, such transaction would be subject to approval by a majority of our independent and disinterested directors. We would
not be required to obtain an opinion from a third party firm in such event to address whether the business combination is fair to our
public shareholders from a financial point of view. If no opinion is obtained, our shareholders will be relying on the judgment of our
board of directors, who will determine fair market value based on standards generally accepted by the financial community. Such standards
used will be disclosed in our proxy materials or tender offer documents, as applicable, related to our initial business combination.
Unlike some other similarly structured special
purpose acquisition companies, our initial shareholders will receive additional Class A ordinary shares if we issue certain shares to
consummate an initial business combination.
The founder shares may be converted into Class
A ordinary shares concurrently with or following the consummation of our initial business combination on a one-for-one basis, subject
to adjustment for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like, and subject to further
adjustment as provided herein. In the case that additional Class A ordinary shares or equity-linked securities are issued or deemed issued
in connection with our initial business combination, the number of Class A ordinary shares issuable upon conversion of all founder shares
will equal, in the aggregate, 25% of the total number of Class A ordinary shares outstanding after such conversion (after giving effect
to any redemptions of Class A ordinary shares by public shareholders and regardless of whether the founder shares have converted), including
the total number of Class A ordinary shares issued, or deemed issued or issuable upon conversion or exercise of any equity-linked securities
or rights issued or deemed issued, by the company in connection with or in relation to the consummation of the initial business combination,
excluding any Class A ordinary shares or equity-linked securities exercisable for or convertible into Class A ordinary shares issued,
or to be issued, to any seller in the initial business combination and any private placement warrants to be issued to our sponsor, officers
or directors upon conversion of working capital loans; provided that such conversion of founder shares will never occur on a less than
one-for-one basis.
We may issue notes or other debt securities,
or otherwise incur substantial debt, to complete a business combination, which may adversely affect our leverage and financial condition
and thus negatively impact the value of our shareholders’ investment in us.
Although we have no commitments as of December
31, 2021 to issue any notes or other debt securities, or to otherwise incur outstanding debt, we may choose to incur substantial debt
to complete our initial business combination. We and our officers have agreed that we will not incur any indebtedness unless we have obtained
from the lender a waiver of any right, title, interest or claim of any kind in or to the monies held in the trust account. As such, no
issuance of debt will affect the per-share amount available for redemption from the trust account. Nevertheless, the incurrence of debt
could have a variety of negative effects, including:
| ● | default
and foreclosure on our assets if our operating revenues after an initial business combination
are insufficient to repay our debt obligations; |
| ● | acceleration of our obligations to repay the indebtedness even if we make all principal and interest payments when due if we breach
certain covenants that require the maintenance of certain financial ratios or reserves without a waiver or renegotiation of that covenant; |
| ● | our immediate payment of all principal and accrued interest, if any, if the debt security is payable on demand; |
| ● | our inability to obtain necessary additional financing if the debt security contains covenants restricting our ability to obtain such
financing while the debt security is outstanding; |
| ● | our inability to pay dividends on our Class A ordinary shares; |
| ● | using a substantial portion of our cash flow to pay principal and interest on our debt, which will reduce the funds available for
dividends on our Class A ordinary shares if declared, expenses, capital expenditures, acquisitions and other general corporate purposes; |
| ● | limitations on our flexibility in planning for and reacting to changes in our business and in the industry in which we operate; |
| ● | increased vulnerability to adverse changes in general economic, industry and competitive conditions and adverse changes in government
regulation; and |
| ● | limitations on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements,
execution of our strategy and other purposes and other disadvantages compared to our competitors who have less debt. |
We may only be able to complete one business
combination with the proceeds from our IPO and the sale of the private placement warrants, which will cause us to be solely dependent
on a single business which may have a limited number of products or services. This lack of diversification may negatively impact our operations
and profitability.
The net proceeds from our IPO and the private
placement of warrants provided us with $205,275,000 that we may use to complete our initial business combination (after taking into account
the $7,043,750 of deferred underwriting commissions being held in the trust account, and offering expenses and working capital costs of
$2,100,000).
We may effectuate our initial business combination
with a single target business or multiple target businesses simultaneously or within a short period of time. However, we may not be able
to effectuate our initial business combination with more than one target business because of various factors, including the existence
of complex accounting issues and the requirement that we prepare and file pro forma financial statements with the SEC that present operating
results and the financial condition of several target businesses as if they had been operated on a combined basis. By completing our initial
business combination with only a single entity, our lack of diversification may subject us to numerous economic, competitive and regulatory
developments. Further, we would not be able to diversify our operations or benefit from the possible spreading of risks or offsetting
of losses, unlike other entities which may have the resources to complete several business combinations in different industries or different
areas of a single industry. Accordingly, the prospects for our success may be:
| ● | solely
dependent upon the performance of a single business, property or asset, or |
| ● | dependent upon the development or market acceptance of a single or limited number of products, processes or services. |
This lack of diversification may subject us to
numerous economic, competitive and regulatory risks, any or all of which may have a substantial adverse impact upon the particular industry
in which we may operate subsequent to our initial business combination.
We may attempt to simultaneously complete business
combinations with multiple prospective targets, which may hinder our ability to complete our initial business combination and give rise
to increased costs and risks that could negatively impact our operations and profitability.
If we determine to simultaneously acquire several
businesses that are owned by different sellers, we will need for each of such sellers to agree that our purchase of its business is contingent
on the simultaneous closings of the other business combinations, which may make it more difficult for us, and delay our ability, to complete
our initial business combination. With multiple business combinations, we could also face additional risks, including additional burdens
and costs with respect to possible multiple negotiations and due diligence investigations (if there are multiple sellers) and the additional
risks associated with the subsequent assimilation of the operations and services or products of the acquired companies in a single operating
business. If we are unable to adequately address these risks, it could negatively impact our profitability and results of operations.
We may seek business combination opportunities
with a high degree of complexity that require significant operational improvements, which could delay or prevent us from achieving our
desired results.
We may seek business combination opportunities
with large, highly complex companies that we believe would benefit from operational improvements. While we intend to implement such improvements,
to the extent that our efforts are delayed or we are unable to achieve the desired improvements, the business combination may not be as
successful as we anticipate.
To the extent we complete our initial business
combination with a large complex business or entity with a complex operating structure, we may also be affected by numerous risks inherent
in the operations of the business with which we combine, which could delay or prevent us from implementing our strategy. Although our
management team will endeavor to evaluate the risks inherent in a particular target business and its operations, we may not be able to
properly ascertain or assess all of the significant risk factors until we complete our business combination. If we are not able to achieve
our desired operational improvements, or the improvements take longer to implement than anticipated, we may not achieve the gains that
we anticipate. Furthermore, some of these risks and complexities may be outside of our control and leave us with no ability to control
or reduce the chances that those risks and complexities will adversely impact a target business. Such combination may not be as successful
as a combination with a smaller, less complex organization.
Our management may not be able to maintain control
of a target business after our initial business combination. We cannot provide assurance that, upon loss of control of a target business,
new management will possess the skills, qualifications or abilities necessary to profitably operate such business.
We may structure our initial business combination
so that the post-business combination company in which our public shareholders own shares will own less than 100% of the equity interests
or assets of a target business, but we will only complete such business combination if the post-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
us not to be required to register as an investment company under the Investment Company Act. We will not consider any transaction that
does not meet such criteria. Even if the post-business combination company owns 50% or more of the voting securities of the target, our
shareholders prior to the business combination may collectively own a minority interest in the post-business combination company, depending
on valuations ascribed to the target and us in the business combination. For example, we could pursue a transaction in which we issue
a substantial number of new Class A ordinary shares in exchange for all of the outstanding capital stock, shares or other equity interests
of a target, or issue a substantial number of new shares to third-parties in connection with financing our initial business combination
or issue a substantial number of new shares to third-parties in connection with financing our initial business combination. In this case,
we would acquire a 100% interest in the target. However, as a result of the issuance of a substantial number of new Class A ordinary shares,
our shareholders immediately prior to such transaction could own less than a majority of our issued and outstanding Class A ordinary shares
subsequent to such transaction. In addition, other minority shareholders may subsequently combine their holdings resulting in a single
person or group obtaining a larger share of the company’s shares than we initially acquired. Accordingly, this may make it more
likely that our management will not be able to maintain control of the target business.
We do not have a specified maximum redemption
threshold. The absence of such a redemption threshold may make it possible for us to complete our initial business combination with which
a substantial majority of our shareholders do not agree.
Our amended and restated memorandum and articles
of association provide that in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less
than $5,000,001. In addition, our proposed initial business combination may impose a minimum cash requirement for (i) cash consideration
to be paid to the target or its owners, (ii) cash for working capital or other general corporate purposes or (iii) the retention
of cash to satisfy other conditions. As a result, we may be able to complete our initial business combination even though a substantial
majority of our public shareholders do not agree with the transaction and have redeemed their shares or, if we seek shareholder approval
of our initial business combination and do not conduct redemptions in connection with our initial business combination pursuant to the
tender offer rules, have entered into privately negotiated agreements to sell their shares to our sponsor, officers, directors, advisors
or any of their affiliates. In the event the aggregate cash consideration we would be required to pay for all Class A ordinary shares
that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business
combination exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares, all
Class A ordinary shares submitted for redemption will be returned to the holders thereof, and we instead may search for an alternate business
combination.
Certain agreements related to our IPO may be
amended without shareholder approval.
Each of the agreements related to our IPO to which
we are a party, other than (i) the warrant agreement (except for provisions of the warrant agreement enabling amendments without shareholder
or warrant holder approval that are necessary or advisable in the good faith determination of our board of directors (taking into account
then existing market precedents) to allow for the warrants to be classified as equity in our financial statements, provided that any modifications
or amendments that would increase the warrant price or shorten the exercise period shall require the approval of the warrant holders in
accordance with the warrant agreement) and (ii) the investment management trust agreement, may be amended without shareholder approval.
Such agreements include the underwriting agreement; the letter agreement among us and our initial shareholders, sponsor, officers and
directors; the registration rights agreement among us and our initial shareholders; the private placement warrants purchase agreement
between us and our sponsor; and a forward purchase agreement between us and our sponsor we may enter into following consummation of our
IPO. These agreements contain various provisions that our public shareholders might deem to be material. For example, our letter agreement
and the underwriting agreement contain certain lock-up provisions with respect to the founder shares, private placement warrants and other
securities held by our initial shareholders, sponsor, officers and directors. Amendments to such agreements would require the consent
of the applicable parties thereto and would need to be approved by our board of directors, which may do so for a variety of reasons, including
to facilitate our initial business combination. While we do not expect our board of directors to approve any amendment to any of these
agreements prior to our initial business combination, it may be possible that our board of directors, in exercising its business judgment
and subject to its fiduciary duties, chooses to approve one or more amendments to any such agreement. Any amendment entered into in connection
with the consummation of our initial business combination will be disclosed in our proxy materials or tender offer documents, as applicable,
related to such initial business combination, and any other material amendment to any of our material agreements will be disclosed in
a filing with the SEC. Any such amendments would not require approval from our shareholders, may result in the completion of our initial
business combination that may not otherwise have been possible, and may have an adverse effect on the value of an investment in our securities.
For example, amendments to the lock-up provision discussed above may result in our initial shareholders selling their securities earlier
than they would otherwise be permitted, which may have an adverse effect on the price of our securities.
Our initial shareholders control a substantial
interest in us and thus may exert substantial influence on actions requiring a shareholder vote, potentially in a manner that you do not
support.
Prior to the initial business combination, the
holders of founder shares will hold approximately 25% of the combined voting power of the founder shares and public shares voting together
as a single class (assuming all issued and outstanding shares are voted and the parties to the letter agreement have not acquired any
Class A ordinary shares). Accordingly, they may exert a substantial influence on actions requiring a shareholder vote, potentially in
a manner that you do not support, including amendments to our amended and restated memorandum and articles of association. Neither our
initial shareholders nor, to our knowledge, any of our officers or directors, have any current intention to purchase additional securities,
other than as disclosed in this annual report. Factors that would be considered in making such additional purchases would include consideration
of the current trading price of our Class A ordinary shares. In addition, our board of directors, whose members were appointed by our
sponsor, is and will be divided into three classes, each of which will generally serve for a terms for three years with only one class
of directors being appointed in each year. We may not hold an annual general meeting to appoint new directors prior to the completion
of our initial business combination, in which case all of the current directors will continue in office until at least the completion
of the business combination. If there is an annual general meeting, as a consequence of our “staggered” board of directors,
only a minority of the board of directors will be considered for appointment and our initial shareholders, because of their ownership
position, will have considerable influence regarding the outcome. Accordingly, our initial shareholders will continue to exert control
at least until the completion of our initial business combination.
As the number of special purpose acquisition
companies evaluating targets increases, attractive targets may become scarcer and there may be more competition for attractive targets.
This could increase the cost of our initial business combination and could even result in our inability to find a target or to consummate
an initial business combination.
In recent years, the number of special purpose
acquisition companies that have been formed has increased substantially. Many potential targets for special purpose acquisition companies
have already entered into an initial business combination, and there are still many special purpose acquisition companies preparing for
an IPO, as well as many such companies currently in registration. As a result, at times, fewer attractive targets may be available to
consummate an initial business combination.
In addition, because there are more special purpose
acquisition companies seeking to enter into an initial business combination with available targets, the competition for available targets
with attractive fundamentals or business models may increase, which could cause targets companies to demand improved financial terms.
Attractive deals could also become scarcer for other reasons, such as economic or industry sector downturns, geopolitical tensions, the
COVID-19 pandemic and government measures taken to curb the spread of the virus, or increases in the cost of additional capital needed
to close business combinations or operate targets post-business combination. This could increase the cost of, delay or otherwise complicate
or frustrate our ability to find and consummate an initial business combination, and may result in our inability to consummate an initial
business combination on terms favorable to our investors altogether.
Risks Relating to Our Sponsor and Management Team
We are dependent upon our founders and officers
and their loss could adversely affect our ability to operate.
Our operations are dependent upon a relatively
small group of individuals and, in particular, our founders and officers. We believe that our success depends on the continued service
of our founders and officers, at least until we have completed our initial business combination. In addition, our founders and officers
are not required to commit any specified amount of time to our affairs and, accordingly, will have conflicts of interest in allocating
their time among various business activities, including identifying potential business combinations and monitoring the related due diligence.
We do not have an employment agreement with, or key-man insurance on the life of, any of our founders or officers. The unexpected loss
of the services of one or more of our founders or officers could have a detrimental effect on us.
Our ability to successfully effect our initial
business combination and to be successful thereafter will be dependent upon the efforts of our key personnel, some of whom may join us
following our initial business combination. The loss of key personnel could negatively impact the operations and profitability of our
post-combination business.
Our ability to successfully effect our initial
business combination is dependent upon the efforts of our key personnel. The role of our key personnel in the target business, however,
cannot presently be ascertained. Although some of our key personnel may remain with the target business in senior management or advisory
positions following our initial business combination, it is likely that some or all of the management of the target business will remain
in place. While we intend to closely scrutinize any individuals we engage after our initial business combination, we cannot assure you
that our assessment of these individuals will prove to be correct. These individuals may be unfamiliar with the requirements of operating
a company regulated by the SEC, which could cause us to have to expend time and resources helping them become familiar with such requirements.
Our key personnel may negotiate employment or
consulting agreements with a target business in connection with a particular business combination, and a particular business combination
may be conditioned on the retention or resignation of such key personnel. These agreements may provide for them to receive compensation
following our initial business combination and as a result, may cause them to have conflicts of interest in determining whether a particular
business combination is the most advantageous.
Our key personnel may be able to remain with our
company after the completion of our initial business combination only if they are able to negotiate employment or consulting agreements
in connection with the business combination. Such negotiations would take place simultaneously with the negotiation of the business combination
and could provide for such individuals to receive compensation in the form of cash payments and/or our securities for services they would
render to us after the completion of the business combination. Such negotiations also could make such key personnel’s retention
or resignation a condition to any such agreement. The personal and financial interests of such individuals may influence their motivation
in identifying and selecting a target business, subject to their fiduciary duties under Cayman Islands law.
Our officers and directors will allocate their
time to other businesses thereby causing conflicts of interest in their determination as to how much time to devote to our affairs. This
conflict of interest could have a negative impact on our ability to complete our initial business combination.
Our officers and directors are not required to,
and will not, commit their full time to our affairs, which may result in a conflict of interest in allocating their time between our operations
and our search for a business combination and their other businesses. We do not intend to have any full-time employees prior to the completion
of our initial business combination. Each of our officers is engaged in other business endeavors for which he may be entitled to substantial
compensation, and our officers are not obligated to contribute any specific number of hours per week to our affairs. Our independent directors
also serve as officers and board members for other entities. If our officers’ and directors’ other business affairs require
them to devote substantial amounts of time to such affairs in excess of their current commitment levels, it could limit their ability
to devote time to our affairs which may have a negative impact on our ability to complete our initial business combination. For a complete
discussion of our officers’ and directors’ other business affairs, please see “Item 10. Directors, Executive Officers
and Corporate Governance— Directors and Executive Officers.”
Our officers and directors presently have, and
any of them in the future may have additional, fiduciary or contractual obligations to other entities and, accordingly, may have conflicts
of interest in determining to which entity a particular business opportunity should be presented.
Until we consummate our initial business combination,
we intend to engage in the business of identifying and combining with one or more businesses. Each of our officers and directors presently
has, and any of them in the future may have, additional fiduciary or contractual obligations to other entities pursuant to which such
officer or director is or will be required to present a business combination opportunity to such entity. Accordingly, they may have conflicts
of interest in determining to which entity a particular business opportunity should be presented. These conflicts may not be resolved
in our favor and a potential target business may be presented to another entity prior to its presentation to us, subject to their fiduciary
duties under Cayman Islands law. Our amended and restated memorandum and articles of association provide that, to the fullest extent permitted
by applicable law: (i) no individual serving as a director or an officer shall have any duty, except and to the extent expressly
assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as
us; and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction
or matter which may be a corporate opportunity for any director or officer on the one hand, and us, on the other.
In addition, our sponsor and our officers and
directors may sponsor or form other special purpose acquisition companies similar to ours or may pursue other business or investment ventures
during the period in which we are seeking an initial business combination. Any such companies, businesses or investments may present additional
conflicts of interest in pursuing an initial business combination. However, we do not believe that any such potential conflicts would
materially affect our ability to identify and pursue business combination opportunities or to complete our initial business combination.
For a complete discussion of our officers’
and directors’ business affiliations and the potential conflicts of interest that you should be aware of, please see “Item
10. Directors, Executive Officers and Corporate Governance— Directors and Executive Officers,” “Item 10. Directors,
Executive Officers and Corporate Governance—Conflicts of Interest” and “Item 13. Certain Relationships and Related Transactions,
and Director Independence.”
Our officers, directors, security holders and
their respective affiliates may have competitive pecuniary interests that conflict with our interests.
We have not adopted a policy that expressly prohibits
our directors, officers, security holders or affiliates from having a direct or indirect pecuniary or financial interest in any investment
to be acquired or disposed of by us or in any transaction to which we are a party or have an interest. In fact, we may enter into a business
combination with a target business that is affiliated with our sponsor, our directors, officers or funds managed by certain of our affiliates.
Nor do we have a policy that expressly prohibits any such persons from engaging for their own account in business activities of the types
conducted by us. Accordingly, such persons or entities may have a conflict between their interests and ours.
The personal and financial interests of our directors
and officers may influence their motivation in timely identifying and selecting a target business and completing a business combination.
Consequently, our directors’ and officers’ discretion in identifying and selecting a suitable target business may result in
a conflict of interest when determining whether the terms, conditions and timing of a particular business combination are appropriate
and in our shareholders’ best interest. If this were the case, it would be a breach of their fiduciary duties to us as a matter
of Cayman Islands law and we or our shareholders might have a claim against such individuals for infringing on our shareholders’
rights. See the section titled “Item 10. Directors, Executive Officers and Corporate Governance—Conflicts of Interest”
for further information on the ability to bring such claims. However, we might not ultimately be successful in any claim we may make against
them for such reason.
We may engage in a business combination with
one or more target businesses that have relationships with entities that may be affiliated with our sponsor, officers, directors, existing
holders or funds managed by certain of our affiliates, which may raise potential conflicts of interest.
In light of the involvement of our sponsor, officers
and directors with other entities, we may decide to acquire one or more businesses affiliated with our sponsor, officers, directors, existing
holders or funds managed by certain of our affiliates. Our directors also serve as officers and board members for other entities, including,
without limitation, those described under “Item 10. Directors, Executive Officers and Corporate Governance—Conflicts of Interest.”
Such entities may compete with us for business combination opportunities. Our sponsor, officers and directors are not currently aware
of any specific opportunities for us to complete our initial business combination with any entities with which they are affiliated, and
there have been no substantive discussions concerning a business combination with any such entity or entities. Although we will not be
specifically focusing on, or targeting, any transaction with any affiliated entities, we would pursue such a transaction if we determined
that such affiliated entity met our criteria for a business combination as set forth in “Item 1. Business—Effecting Our Initial
Business Combination—Evaluation of a Target Business and Structuring of Our Initial Business Combination” and such transaction
was approved by a majority of our independent and disinterested directors. We would not be required to obtain an opinion from a third
party firm in such event to address whether the business combination is fair to our public shareholders from a financial point of view.
Despite being subject to approval by a majority of our independent and disinterested directors regarding the fairness to our company from
a financial point of view of a business combination with one or more domestic or international businesses affiliated with our sponsor,
officers, directors, existing holders or funds managed by certain of our affiliates, potential conflicts of interest still may exist and,
as a result, the terms of the business combination may not be as advantageous to our public shareholders as they would be absent any conflicts
of interest.
Certain members of our board of directors and
management team may be involved in and have a greater financial interest in the performance of other entities affiliated with our sponsor,
and such activities may create conflicts of interest in making decisions on our behalf.
Certain of our directors and members of our management
team may be subject to a variety of conflicts of interest relating to their responsibilities to our sponsor and its other affiliates.
Such individuals may serve as members of management or a board of directors (or in similar such capacity) to various other affiliated entities.
Such positions may create a conflict between the advice and investment opportunities provided to such entities and the responsibilities
owed to us. The other entities in which such individuals may become involved may have investment objectives that overlap with ours. Furthermore,
certain of our principals and employees may have a greater financial interest in the performance of such other affiliated entities than
our performance. Such involvement may create conflicts of interest in sourcing investment opportunities on our behalf and on behalf of
such other entities.
Risks Relating to Our Securities
You will not have any rights or interests in
funds from the trust account, except under certain limited circumstances. Therefore, to liquidate your investment, you may be forced to
sell your public shares or warrants, potentially at a loss.
Our public shareholders will be entitled to
receive funds from the trust account only upon the earliest to occur of: (i) our completion of an initial business combination,
and then only in connection with those Class A ordinary shares that such shareholder properly elected to redeem, subject to the
limitations and on the conditions described herein, (ii) the redemption of any public shares properly submitted in connection
with a shareholder vote to amend our amended and restated memorandum and articles of association (A) to modify the substance or
timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public
shares if we do not complete our initial business combination by May 23, 2023 (or November 23, 2023 if we extend the
period of time to consummate our initial business combination in accordance with the terms described in our final prospectus) or
(B) with respect to any other material provisions relating to shareholders’ rights or pre-initial business combination
activity, and (iii) the redemption of our public shares if we have not completed an initial business combination by May 23,
2023 (or November 23, 2023 if we extend the period of time to consummate our initial business combination in accordance with the
terms described in our final prospectus), subject to applicable law and as further described herein. In no other circumstances will
a public shareholder have any right or interest of any kind in the trust account. Holders of warrants will not have any right to the
funds held in the trust account. Accordingly, to liquidate your investment, you may be forced to sell your public shares or
warrants, potentially at a loss.
Nasdaq may delist our securities from trading
on its exchange, which could limit investors’ ability to make transactions in our securities and subject us to additional trading
restrictions.
Our units, Class A ordinary shares and warrants
are listed on Nasdaq. Although we expect to meet on a pro forma basis Nasdaq’s minimum initial listing standards, which generally
only require that we meet certain requirements relating to shareholders’ equity, market capitalization, aggregate market value of
publicly held shares and distribution requirements, we cannot assure you that our securities will be, or will continue to be, listed on
Nasdaq in the future or prior to our initial business combination. In order to continue listing our securities on Nasdaq prior to our
initial business combination, we must maintain certain financial, distribution and share price levels. Generally, we must maintain a minimum
amount in shareholders’ equity (generally $2,500,000) and a minimum number of holders of our securities (generally 400 public holders).
Additionally, in connection with our initial business combination, we will be required to demonstrate compliance with Nasdaq’s initial
listing requirements, which are more rigorous than Nasdaq’s continued listing requirements, in order to continue to maintain the
listing of our securities on Nasdaq. For instance, our share price would generally be required to be at least $4.00 per share and our
shareholders’ equity would generally be required to be at least $5.0 million. We cannot assure you that we will be able to meet
those initial listing requirements at that time.
If Nasdaq were to delist our securities prior
to the consummation of an initial business combination, or we were to voluntarily delist our securities prior to such time, we would no
longer be required to complete a business combination having an aggregate fair market value of at least 80% of the net assets held in
the trust account (excluding the amount of deferred underwriting commissions held in the trust account). This would allow us to acquire
a target business valued substantially below the amount of funds in our trust account.
If Nasdaq delists any of our securities from trading
on its exchange and we are not able to list our securities on another national securities exchange, we expect our securities could be
quoted on an over-the-counter market. If this were to occur, we could face significant material adverse consequences, including:
| ● | a
limited availability of market quotations for our securities; |
| ● | reduced liquidity for our securities; |
| ● | a
determination that our Class A ordinary shares are a “penny stock” which will
require brokers trading in our Class A ordinary shares to adhere to more stringent rules
and possibly result in a reduced level of trading activity in the secondary trading market
for our securities; |
| ● | a limited amount of news and analyst coverage; and |
| ● | a decreased ability to issue additional securities or obtain additional financing in the future. |
The National Securities Markets Improvement Act
of 1996, which is a federal statute, prevents or preempts the states from regulating the sale of certain securities, which are referred
to as “covered securities.” Because we expect that our units and eventually our Class A ordinary shares and warrants will
be listed on Nasdaq, our units, Class A ordinary shares and warrants will qualify as covered securities under the statute. Although the
states are preempted from regulating the sale of our securities, the federal statute does allow the states to investigate companies if
there is a suspicion of fraud, and, if there is a finding of fraudulent activity, then the states can regulate or bar the sale of covered
securities in a particular case. While we are not aware of a state having used these powers to prohibit or restrict the sale of securities
issued by blank check companies, other than the State of Idaho, certain state securities regulators view blank check companies unfavorably
and might use these powers, or threaten to use these powers, to hinder the sale of securities of blank check companies in their states.
Further, if we were no longer listed on Nasdaq, our securities would not qualify as covered securities under the statute and we would
be subject to regulation in each state in which we offer our securities.
Holders of our public shares are not entitled
to vote on the appointment of directors prior to our initial business combination.
Prior to our initial business combination, only
holders of Class B ordinary shares have the right to appointment directors in any general meeting. Holders of our public shares will not
be entitled to vote on the appointment of directors during such time. Accordingly, holders of our public shares may not have any say in
the management of our company prior to the completion of an initial business combination.
You are not entitled to protections normally
afforded to investors of many other blank check companies.
Since the net proceeds of our IPO and the sale
of the private placement warrants are intended to be used to complete an initial business combination with a target business that has
not been selected, we may be deemed to be a “blank check” company under the United States securities laws. However, because
we have net tangible assets in excess of $5,000,001 as of the completion of our IPO and the sale of the private placement warrants and
we filed a Current Report on Form 8-K, including an audited balance sheet demonstrating this fact, we are exempt from rules promulgated
by the SEC to protect investors in blank check companies, such as Rule 419. Accordingly, investors are not afforded the benefits or protections
of those rules. Among other things, this means our units were immediately tradable and we have a longer period of time to complete our
initial business combination than do companies subject to Rule 419. Moreover, if our IPO were subject to Rule 419, that rule would have
prohibited the release of any interest earned on funds held in the trust account to us unless and until the funds in the trust account
were released to us in connection with our completion of an initial business combination.
If we seek shareholder approval of our initial
business combination and we do not conduct redemptions pursuant to the tender offer rules, and if you or a “group” of shareholders
are deemed to hold in excess of 15% of our Class A ordinary shares, you will lose the ability to redeem all such shares in excess of 15%
of our Class A ordinary shares.
If we seek shareholder approval of our initial
business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer
rules, our amended and restated memorandum and articles of association provide that a public shareholder, together with any affiliate
of such shareholder or any other person with whom such shareholder is acting in concert or as a “group” (as defined under
Section 13 of the Exchange Act), will be restricted from seeking redemption rights with respect to more than an aggregate of 15% of the
shares sold in our IPO without our prior consent, which we refer to as the “Excess Shares.” However, we would not be restricting
our shareholders’ ability to vote all of their shares (including Excess Shares) for or against our initial business combination.
Your inability to redeem the Excess Shares will reduce your influence over our ability to complete our initial business combination and
you could suffer a material loss on your investment in us if you sell Excess Shares in open market transactions. Additionally, you will
not receive redemption distributions with respect to the Excess Shares if we complete our initial business combination. As a result, you
will continue to hold that number of shares exceeding 15% and, in order to dispose of such shares, would be required to sell your shares
in open market transactions, potentially at a loss.
Our warrant agreement designates the courts
of the State of New York or the United States District Court for the Southern District of New York as the sole and exclusive forum for
certain types of actions and proceedings that may be initiated by holders of our warrants, which could limit the ability of warrant holders
to obtain a favorable judicial forum for disputes with our company.
Our warrant agreement provides that, subject to
applicable law, (i) any action, proceeding or claim against us arising out of or relating in any way to the warrant agreement, including
under the Securities Act, will be brought and enforced in the courts of the State of New York or the United States District Court for
the Southern District of New York, and (ii) that we irrevocably submit to such jurisdiction, which jurisdiction shall be the exclusive
forum for any such action, proceeding or claim. We will waive any objection to such exclusive jurisdiction and that such courts represent
an inconvenient forum.
Notwithstanding the foregoing, these provisions
of the warrant agreement will not apply to suits brought to enforce any liability or duty created by the Exchange Act or any other claim
for which the federal district courts of the United States of America are the sole and exclusive forum. Any person or entity purchasing
or otherwise acquiring any interest in any of our warrants shall be deemed to have notice of and to have consented to the forum provisions
in our warrant agreement. If any action, the subject matter of which is within the scope of the forum provisions of our warrant agreement,
is filed in a court other than a court of the State of New York or the United States District Court for the Southern District of New York
(a “foreign action”) in the name of any holder of our warrants, such holder shall be deemed to have consented to: (x) the
personal jurisdiction of the state and federal courts located in the State of New York in connection with any action brought in any such
court to enforce the forum provisions (an “enforcement action”), and (y) having service of process made upon such warrant
holder in any such enforcement action by service upon such warrant holder’s counsel in the foreign action as agent for such warrant
holder.
This choice-of-forum provision may limit a warrant
holder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with our company, which may discourage
such lawsuits. Alternatively, if a court were to find this provision of our warrant agreement inapplicable or unenforceable with respect
to one or more of the specified types of actions or proceedings, we may incur additional costs associated with resolving such matters
in other jurisdictions, which could materially and adversely affect our business, financial condition and results of operations and result
in a diversion of the time and resources of our management and board of directors.
If we are deemed to be an investment company
under the Investment Company Act, we may be required to institute burdensome compliance requirements and our activities may be restricted,
which may make it difficult for us to complete our initial business combination.
If we are deemed to be an investment company under
the Investment Company Act, our activities may be restricted, including:
| ● | restrictions on the nature of our investments; and |
| ● | restrictions on the issuance of securities, |
| ● | each of which may make it difficult for us to complete our initial business combination. In addition, we may have imposed upon us
burdensome requirements, including: |
| ● | registration as an investment company with the SEC; |
| ● | adoption of a specific form of corporate structure; and |
| ● | reporting, record keeping, voting, proxy and disclosure requirements and other rules and regulations that we are not subject to. |
In order not to be regulated as an investment
company under the Investment Company Act, unless we can qualify for an exclusion, we must ensure that we are engaged primarily in a business
other than investing, reinvesting or trading of securities and that our activities do not include investing, reinvesting, owning, holding
or trading “investment securities” constituting more than 40% of our assets (exclusive of U.S. government securities and cash
items) on an unconsolidated basis. Our business will be to identify and complete a business combination and thereafter to operate the
post-business combination business or assets for the long term. We do not plan to buy businesses or assets with a view to resale or profit
from their resale. We do not plan to buy unrelated businesses or assets or to be a passive investor.
We do not believe that our anticipated principal
activities will subject us to the Investment Company Act. To this end, the proceeds held in the trust account may only be invested in
United States “government securities” within the meaning of Section 2(a)(16) of the Investment Company Act having a maturity
of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act which
invest only in direct U.S. government treasury obligations. Pursuant to the trust agreement, the trustee is not permitted to invest in
other securities or assets. By restricting the investment of the proceeds to these instruments, and by having a business plan targeted
at acquiring and growing businesses for the long term (rather than on buying and selling businesses in the manner of a merchant bank or
private equity fund), we intend to avoid being deemed an “investment company” within the meaning of the Investment Company
Act. Our initial public is not intended for persons who are seeking a return on investments in government securities or investment securities.
The trust account is intended as a holding place for funds pending the earliest to occur of either: (i) the completion of our initial
business combination; (ii) the redemption of any public shares properly submitted in connection with a shareholder vote to amend
our amended and restated memorandum and articles of association (A) to modify the substance or timing of our obligation to allow
redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial
business combination by May 23, 2023 (or November 23, 2023 if we extend the period of time to consummate our initial business combination
in accordance with the terms described in our final prospectus) or (B) with respect to any other material provisions relating to
shareholders’ rights or pre-initial business combination activity; or (iii) absent an initial business combination by May 23,
2023 (or November 23, 2023 if we extend the period of time to consummate our initial business combination in accordance with the terms
described in our final prospectus), our return of the funds held in the trust account to our public shareholders as part of our redemption
of the public shares. If we do not invest the proceeds as discussed above, we may be deemed to be subject to the Investment Company Act.
If we were deemed to be subject to the Investment Company Act, compliance with these additional regulatory burdens would require additional
expenses for which we have not allotted funds and may hinder our ability to complete a business combination. If we are unable to complete
our initial business combination, our public shareholders may only receive their pro rata portion of the funds in the trust account that
are available for distribution to public shareholders, and our warrants will expire worthless.
Our ability to require holders of our warrants
to exercise such warrants on a cashless basis after we call the warrants for redemption or if there is no effective registration statement
covering the Class A ordinary shares issuable upon exercise of these warrants will cause holders to receive fewer Class A ordinary shares
upon their exercise of the warrants than they would have received had they been able to pay the exercise price of their warrants in cash.
If we call the warrants for redemption, we will
have the option, in our sole discretion, to require all holders that wish to exercise warrants to do so on a cashless basis under certain
circumstances described in the prospectus for our IPO. If we choose to require holders to exercise their warrants on a cashless basis or
if holders elect to do so when there is no effective registration statement, the number of Class A ordinary shares received by a holder
upon exercise will be fewer than it would have been had such holder exercised his or her warrant for cash. For example, if the holder
is exercising 875 public warrants at $11.50 per share through a cashless exercise when the Class A ordinary shares have a fair market
value of $17.50 per share when there is no effective registration statement, then upon the cashless exercise, the holder will receive
300 Class A ordinary shares. The holder would have received 875 Class A ordinary shares if the exercise price was paid in cash. This will
have the effect of reducing the potential “upside” of the holder’s investment in our company because the warrant holder
will hold a smaller number of Class A ordinary shares upon a cashless exercise of the warrants they hold.
The grant of registration rights to our initial
shareholders and holders of our private placement warrants may make it more difficult to complete our initial business combination, and
the future exercise of such rights may adversely affect the market price of our Class A ordinary shares.
Our initial shareholders and their permitted transferees
can demand that we register the Class A ordinary shares into which founder shares are convertible, holders of our private placement warrants
and their permitted transferees can demand that we register the private placement warrants and the Class A ordinary shares issuable upon
exercise of the private placement warrants, and holders of securities that may be issued upon conversion of working capital loans may
demand that we register such units, shares, warrants or the Class A ordinary shares issuable upon exercise of such warrants. We will bear
the cost of registering these securities. The registration and availability of such a significant number of securities for trading in
the public market may have an adverse effect on the market price of our Class A ordinary shares. In addition, the existence of the registration
rights may make our initial business combination more costly or difficult to conclude. This is because the shareholders of the target
business may increase the equity stake they seek in the combined entity or ask for more cash consideration to offset the negative impact
on the market price of our Class A ordinary shares that is expected when the ordinary shares owned by our initial shareholders, holders
of our private placement warrants or holders of our working capital loans or their respective permitted transferees are registered.
We may be a passive foreign investment company,
or “PFIC,” which could result in adverse U.S. federal income tax consequences to U.S. investors.
If we are a PFIC for any taxable year (or portion
thereof) that is included in the holding period of a U.S. Holder (as defined in the section of this annual report captioned “Income
Tax Considerations—U.S. Federal Income Tax Considerations”) of our Class A ordinary shares or warrants, the U.S. Holder may
be subject to adverse U.S. federal income tax consequences and may be subject to additional reporting requirements. Our PFIC status for
our current and subsequent taxable years may depend on whether we qualify for the PFIC start-up exception (see the section of our final
prospectus captioned “Income Tax Considerations—U.S. Federal Income Tax Considerations—Passive Foreign Investment Company
Rules”). Depending on the particular circumstances the application of the start-up exception may be subject to uncertainty, and
there cannot be any assurance that we will qualify for the start-up exception. Accordingly, there can be no assurances with respect to
our status as a PFIC for our current taxable year or any subsequent taxable year. Our actual PFIC status for any taxable year will not
be determinable until after the end of such taxable year (and, in the case of the start-up exception, potentially not until after the
two taxable years following our current taxable year). Moreover, if we determine we are a PFIC for any taxable year, we will endeavor
to provide to a U.S. Holder a PFIC Annual Information Statement, in order to enable the U.S. Holder to make and maintain a “qualified
electing fund” election, but there can be no assurance that we will timely provide such required information, and such election
would be unavailable with respect to our warrants in all cases. We urge U.S. investors to consult their tax advisors regarding the possible
application of the PFIC rules. For a more detailed explanation of the tax consequences of PFIC classification to U.S. Holders, see the
section of our final prospectus captioned “Income Tax Considerations—U.S. Federal Income Tax Considerations—Passive
Foreign Investment Company Rules.”
We may issue additional Class A ordinary shares
or preferred shares to complete our initial business combination or under an employee incentive plan after completion of our initial business
combination. We may also issue additional Class A ordinary shares upon the conversion of the founder shares at a ratio greater than one-to-one
at the time of our initial business combination as a result of the anti-dilution provisions contained in our amended and restated memorandum
and articles of association. Any such issuances would dilute the interest of our shareholders and likely present other risks.
Our amended and restated memorandum and articles
of association authorize the issuance of up to 500,000,000 Class A ordinary shares, par value $0.0001 per share, 50,000,000 Class B ordinary
shares, par value $0.0001 per share, and 5,000,000 preferred shares, par value $0.0001 per share. There are 479,875,000 and 43,291,667
authorized but unissued Class A ordinary shares and Class B ordinary shares, respectively, available for issuance which amount does not
take into account shares reserved for issuance upon exercise of outstanding warrants or shares issuable upon conversion of the Class B
ordinary shares. The Class B ordinary shares may be converted into Class A ordinary shares concurrently with or following the consummation
of our initial business combination, initially at a one-for-one ratio but subject to adjustment as set forth herein and in our amended
and restated memorandum and articles of association, including in certain circumstances in which we issue Class A ordinary shares or equity-linked
securities related to our initial business combination. We have no preferred shares issued and outstanding.
We may issue a substantial number of additional
Class A ordinary shares or preferred shares to complete our initial business combination or under an employee incentive plan after completion
of our initial business combination. We may also issue Class A ordinary shares upon conversion of the Class B ordinary shares at a ratio
greater than one-to-one at the time of our initial business combination as a result of the anti-dilution provisions as set forth therein.
However, our amended and restated memorandum and articles of association provide, among other things, that prior to our initial business
combination, we may not issue additional shares that would entitle the holders thereof to (i) receive funds from the trust account
or (ii) vote as a class with our public shares (a) on any initial business combination or (b) to approve an amendment to our amended
and restated memorandum and articles of association to (x) extend the time we have to consummate a business combination beyond November
23, 2023 or (y) amend the foregoing provisions. These provisions of our amended and restated memorandum and articles of association, like
all provisions of our amended and restated memorandum and articles of association, may be amended with a shareholder vote. The issuance
of additional ordinary or preferred shares:
| ● | may
significantly dilute the equity interest of our investors; |
| ● | may subordinate the rights of holders of Class A ordinary shares if preferred shares are issued with rights senior to those afforded
our Class A ordinary shares; |
| ● | could cause a change in control if a substantial number of Class A ordinary shares are issued, which may affect, among other things,
our ability to use our net operating loss carry forwards, if any, and could result in the resignation or removal of our present officers
and directors; |
| ● | may have the effect of delaying or preventing a change of control of us by diluting the share ownership or voting rights of a person
seeking to obtain control of us; and |
| ● | may adversely affect prevailing market prices for our units, Class A ordinary shares and/or warrants. |
If all of our founder shares convert into our
Class A ordinary shares, and all of the private placement warrants are exercised, our sponsor and initial shareholders will own, in the
aggregate, approximately 62.8% of the ordinary shares issued and outstanding.
Most blank check companies issue founder shares
representing 20% of the ordinary shares issued and outstanding upon the consummation of such blank check company’s IPO. We have
issued 6,708,333 founder shares, of which 5,031,250 will convert into Class A ordinary shares after our initial business combination
and 1,677,083 will convert into Class A ordinary shares only to the extent our stock trades at or above $12.50 per share as described
in this prospectus. In addition, we may be required to issue 10,150,000 Class A ordinary shares as shares underlying our private placement
warrants held by our sponsor. If following our initial business combination all of the founder shares convert into our Class A ordinary
shares and all of the private placement warrants are exercised, our initial shareholders will hold approximately 62.8% of the total ordinary
shares issued and outstanding. Notwithstanding the foregoing, all founder shares that have not been converted to Class A ordinary
shares on the second anniversary of our initial business combination will be exchanged on such date, at the Company’s election,
for an aggregate for all such founder shares of either (i) 100 Class A ordinary shares or (ii) cash, in an amount equal
to the value of 100 Class A ordinary shares, based on the average market price of Class A ordinary shares over the period of
five trading days ending two trading days before the date of exchange. If all of our founder shares convert into our Class A ordinary
shares, the issuance of Class A ordinary shares upon conversion of such shares would dilute the interest of our shareholders relative
to shareholders of other blank check companies.
We cannot assure you that we will not seek to
amend our amended and restated memorandum and articles of association or governing instruments in a manner that will make it easier for
us to complete our initial business combination that our shareholders may not support.
In order to effectuate a business combination,
special purpose acquisition companies have, in the recent past, amended various provisions of their charters and governing instruments,
including their warrant agreements. For example, special purpose acquisition companies have amended the definition of business combination,
increased redemption thresholds and extended the time to consummate an initial business combination and, with respect to their warrants,
amended their warrant agreements to require the warrants to be exchanged for cash and/or other securities. Amending our amended and restated
memorandum and articles of association requires a special resolution under Cayman Islands law, which requires the affirmative vote of
a majority of at least two-thirds of the shareholders who attend and vote at a general meeting of the company, and amending our warrant
agreement will require a vote of holders of at least a majority of the public warrants and, solely with respect to any amendment to the
terms of the private placement warrants or any provision of the warrant agreement with respect to the private placement warrants, a majority
of the then outstanding private placement warrants (except for provisions of the warrant agreement enabling amendments without shareholder
approval or warrant holder that are necessary or advisable in the good faith determination of our board of directors (taking into account
then existing market precedents) to allow for the warrants to be classified as equity in our financial statements, provided that any modifications
or amendments that would increase the warrant price or shorten the exercise period shall require the approval of the warrant holders in
accordance with the warrant agreement). In addition, our amended and restated memorandum and articles of association require us to provide
our public shareholders with the opportunity to redeem their public shares for cash if we propose an amendment to our amended and restated
memorandum and articles of association (A) to modify the substance or timing of our obligation to allow redemption in connection
with our initial business combination or to redeem 100% of our public shares if we do not complete an initial business combination by
May 23, 2023 (or November 23, 2023 if we extend the period of time to consummate our initial business combination in accordance with the
terms described in our final prospectus) or (B) with respect to any other material provisions relating to shareholders’ rights
or pre-initial business combination activity. To the extent any of such amendments would be deemed to fundamentally change the nature
of the securities offered through this registration statement, we would register, or seek an exemption from registration for, the affected
securities. We cannot assure you that we will not seek to amend our charter or governing instruments or extend the time to consummate
an initial business combination in order to effectuate our initial business combination.
The provisions of our amended and restated memorandum
and articles of association that relate to our pre-business combination activity (and corresponding provisions of the agreement governing
the release of funds from our trust account) may be amended with the approval of holders of not less than two-thirds of our ordinary shares
who attend and vote at a general meeting of the company (or 65% of our ordinary shares who attend and vote at a general meeting of the
company with respect to amendments to the trust agreement governing the release of funds from our trust account), which is a lower amendment
threshold than that of some other special purpose acquisition companies. It may be easier for us, therefore, to amend our amended and
restated memorandum and articles of association to facilitate the completion of an initial business combination that some of our shareholders
may not support.
Certain other blank check companies have a provision
in their charter which prohibits the amendment of certain of its provisions, including those which relate to a company’s pre-business
combination activity, without approval by a certain percentage of the company’s shareholders. In those companies, amendment of these
provisions typically requires approval by between 90% and 100% of the company’s shareholders. Our amended and restated memorandum
and articles of association provide that any of its provisions related to pre-business combination activity (including the requirement
to deposit proceeds from our IPO and the private placement of warrants into the trust account and not release such amounts except in specified
circumstances, and to provide redemption rights to public shareholders as described herein) may be amended if approved by special resolution
under Cayman Islands law which requires the affirmative vote of a majority of at least two-thirds of the shareholders who attend and vote
at a general meeting of the company, and corresponding provisions of the trust agreement governing the release of funds from our trust
account may be amended if approved by holders of 65% of our ordinary shares who attend and vote at a general meeting of the company. Our
initial shareholders, who collectively beneficially own 25% of our ordinary shares, will participate in any vote to amend our amended
and restated memorandum and articles of association and/or trust agreement and will have the discretion to vote in any manner they choose.
As a result, we may be able to amend the provisions of our amended and restated memorandum and articles of association which govern our
pre-business combination behavior more easily than some other special purpose acquisition companies, and this may increase our ability
to complete a business combination with which you do not agree. Our shareholders may pursue remedies against us for any breach of our
amended and restated memorandum and articles of association.
Our sponsor, officers and directors have agreed,
pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated memorandum and articles
of association (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business
combination or to redeem 100% of our public shares if we do not complete our initial business combination by May 23, 2023 (or November
23, 2023 if we extend the period of time to consummate our initial business combination in accordance with the terms described in our
final prospectus) or (B) with respect to any other material provisions relating to shareholders’ rights or pre-initial business
combination activity, unless we provide our public shareholders with the opportunity to redeem their Class A ordinary shares upon approval
of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including
interest earned on the funds held in the trust account and not previously released to us to pay our taxes, divided by the number of then
outstanding public shares. Our shareholders are not parties to, or third-party beneficiaries of, these agreements and, as a result, will
not have the ability to pursue remedies against our sponsor, officers or directors for any breach of these agreements. As a result, in
the event of a breach, our shareholders would need to pursue a shareholder derivative action, subject to applicable law.
We may amend the terms of the warrants in a
manner that may be adverse to holders of public warrants with the approval by the holders of at least a majority of the then outstanding
public warrants, or for amendments necessary for the warrants to be classified as equity. As a result, the exercise price of your warrants
could be increased, the exercise period could be shortened and the number of Class A ordinary shares purchasable upon exercise of a warrant
could be decreased, all without your approval.
Our warrants will be issued in registered form
under a warrant agreement between Continental Stock Transfer & Trust Company, as warrant agent, and us. The warrant agreement provides
that the terms of the warrants may be amended without the consent of any shareholder or warrant holder to cure any ambiguity or correct
any defective provision or to make any amendments that are necessary in the good faith determination of our board of directors (taking
into account then existing market precedents) to allow for the warrants to be classified as equity in our financial statements (provided
that any modifications or amendments that would increase the warrant price or shorten the exercise period shall require the approval of
the warrant holders in accordance with the warrant agreement), but otherwise requires the approval by the holders of at least a majority
of the then outstanding public warrants to make any change that adversely affects the interests of the registered holders of public warrants;
provided that any amendment that solely affects the terms of the private placement warrants or any provision of the warrant agreement
solely with respect to the private placement warrants will also require at least a majority of the then outstanding private placement
warrants. Accordingly, we may amend the terms of the public warrants (i) in a manner adverse to a holder of public warrants if holders
of at least a majority of the then outstanding public warrants approve of such amendment or (ii) to the extent necessary for the warrants
in the good faith determination of our board of directors (taking into account then existing market precedents) to allow for the warrants
to be classified as equity in our financial statements without the consent of any shareholder or warrant holder (provided that any modifications
or amendments that would increase the warrant price or shorten the exercise period shall require the approval of the warrant holders in
accordance with the warrant agreement). Although our ability to amend the terms of the public warrants with the consent of at least a
majority of the then outstanding public warrants is unlimited, examples of such amendments could be amendments to, among other things,
increase the exercise price of the warrants, convert the warrants into cash or shares, shorten the exercise period or decrease the number
of Class A ordinary shares purchasable upon exercise of a warrant.
The warrants may become exercisable and redeemable
for a security other than the Class A ordinary shares, and you will not have any information regarding such other security at this time.
In certain situations, including if we are not
the surviving entity in our initial business combination, the warrants may become exercisable for a security other than the Class A ordinary
shares. As a result, if the surviving company redeems your warrants for securities pursuant to the warrant agreement, you may receive
a security in a company of which you do not have information at this time.
A provision of our warrant agreement may make
it more difficult for us to consummate an initial business combination.
If (i) we issue additional ordinary shares
or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at a Newly
Issued Price of less than $9.20 per Class A ordinary share, (ii) the aggregate gross proceeds from such issuances represent more
than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination (net of redemptions),
and (iii) the Market Value of our Class A ordinary shares is below $9.20 per share, the exercise price of the warrants will be adjusted
(to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, the $18.00 per share redemption
trigger price will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price,
and the $10.00 per share redemption trigger price will be adjusted (to the nearest cent) to be equal to the higher of the Market Value
and the Newly Issued Price. This may make it more difficult for us to consummate an initial business combination with a target business.
Our warrants are accounted for as a warrant
liability and recorded at fair value upon issuance with changes in fair value each period reported in earnings, which may have an adverse
effect on the market price of our Class A ordinary shares or may make it more difficult for us to consummate an initial business combination.
Following the consummation of our IPO and the
concurrent private placement of warrants, we issued an aggregate of 20,212,500 warrants in connection with our IPO (comprised of the 10,062,500
warrants included in the units and the 10,150,000 private placement warrants) in accordance with the guidance contained in ASC 815-40.
Such guidance provides that because the warrants do not meet the criteria for equity treatment thereunder, each warrant must be recorded
as a liability. Accordingly, we account for these as a warrant liability and record at fair value upon issuance any changes in fair value
each period reported in earnings as determined by us based upon a valuation report obtained from an independent third party valuation
firm. The impact of changes in fair value on earnings may have an adverse effect on the market price of our Class A ordinary shares. In
addition, potential targets may seek a SPAC that does not have warrants that are accounted for as a warrant liability, which may make
it more difficult for us to consummate an initial business combination with a target business.
We may redeem your unexpired warrants prior
to their exercise at a time that is disadvantageous to you, thereby making your warrants worthless.
We have the ability to redeem the
outstanding warrants at any time after they become exercisable and prior to their expiration, at a price of $0.01 per warrant, if,
among other things, the last reported sales price of our Class A ordinary shares, or Reference Value, equals or exceeds $18.00 per
share (as adjusted for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like). Please see
“Description of Securities—Warrants— Public Shareholders’ Warrants—Redemption of Warrants When the
Price per Class A Ordinary Share Equals or Exceeds $18.00” of our final prospectus, incorporated by reference herein. If and
when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the
underlying securities for sale under all applicable state securities laws. Redemption of the outstanding warrants as described above
could force you to (i) exercise your warrants and pay the exercise price therefor at a time when it may be disadvantageous for
you to do so, (ii) sell your warrants at the then-current market price when you might otherwise wish to hold your warrants or
(iii) accept the nominal redemption price which, at the time the outstanding warrants are called for redemption, we expect
would be substantially less than the volume-weighted average trading price of our Class A ordinary shares during the 20 trading day
period starting on the trading day prior to the day on which we complete our initial business combination, or Market Value, of your
warrants. None of the private placement warrants will be redeemable by us so long as they are held by our sponsor or its permitted
transferees.
In addition, we have the ability to redeem the
outstanding warrants at any time after they become exercisable and prior to their expiration, at a price of $0.10 per warrant if, among
other things, the Reference Value equals or exceeds $10.00 per share (as adjusted for share sub-divisions, share capitalizations, reorganizations,
recapitalizations and the like). In such a case, the holders will be able to exercise their warrants prior to redemption for a number
of our Class A ordinary shares determined based on the redemption date and the fair market value of our Class A ordinary shares.
Please see “Description of Securities—Warrants—Public Shareholders’ Warrants—Redemption of Warrants When
the Price per Class A Ordinary Share Equals or Exceeds $10.00” of our final prospectus, incorporated by reference herein. The value
received upon exercise of the warrants (1) may be less than the value the holders would have received if they had exercised their
warrants at a later time where the underlying share price is higher and (2) may not compensate the holders for the value of the warrants,
including because the number of ordinary shares received is capped at 0.361 of our Class A ordinary shares per warrant (subject to
adjustment) irrespective of the remaining life of the warrants.
Our warrants may have an adverse effect on the
market price of our Class A ordinary shares and make it more difficult to effectuate our initial business combination.
We issued warrants to purchase 10,062,500 Class
A ordinary shares as part of the units in connection with our IPO and, simultaneously, issued in a private placement an aggregate of 10,150,000
warrants, at $1.00 per warrant. In addition, if our sponsor makes any working capital loans, it may convert those loans into up to an
additional 2,100,000 private placement warrants, at the price of $1.00 per warrant. To the extent we issue ordinary shares to effectuate
a business transaction, the potential for the issuance of a substantial number of additional Class A ordinary shares upon exercise of
these warrants could make us a less attractive acquisition vehicle to a target business. Such warrants, when exercised, will increase
the number of issued and outstanding Class A ordinary shares and reduce the value of the Class A ordinary shares issued to complete the
business transaction. Therefore, our warrants may make it more difficult to effectuate a business transaction or increase the cost of
acquiring the target business.
Because each unit contains one-half of one warrant
and only a whole warrant may be exercised, the units may be worth less than units of other special purpose acquisition companies.
Each unit contains one-half of one warrant. Pursuant
to the warrant agreement, no fractional warrants will be issued upon separation of the units, and only whole units will trade. If, upon
exercise of the warrants, a holder would be entitled to receive a fractional interest in a share, we will, upon exercise, round down to
the nearest whole number the number of Class A ordinary shares to be issued to the warrant holder. This is different from other offerings
similar to ours whose units include one ordinary share and one whole warrant to purchase one whole share. We have established the components
of the units in this way in order to reduce the dilutive effect of the warrants upon completion of a business combination since the warrants
will be exercisable in the aggregate for one-half of the number of shares, rather than units that each contain a whole warrant to purchase
one whole share, thus making us, we believe, a more attractive merger partner for target businesses. Nevertheless, this unit structure
may cause our units to be worth less than if it included a warrant to purchase one whole share.
Provisions in our amended and restated memorandum
and articles of association may inhibit a takeover of us, which could limit the price investors might be willing to pay in the future
for our Class A ordinary shares and could entrench management.
Our amended and restated memorandum and articles
of association contain provisions that may discourage unsolicited takeover proposals that shareholders may consider to be in their best
interests. These provisions include a staggered board of directors and the ability of the board of directors to designate the terms of
and issue new series of preferred shares, which may make the removal of management more difficult and may discourage transactions that
otherwise could involve payment of a premium over prevailing market prices for our securities.
Since only holders of our founder shares will
have the right to vote on the election of directors, upon the listing of our shares on Nasdaq, Nasdaq may consider us to be a “controlled
company” within the meaning of Nasdaq rules and, as a result, we may qualify for exemptions from certain corporate governance requirements.
Only holders of our founder shares will have the
right to vote on the election of directors. As a result, Nasdaq may consider us to be a “controlled company” within the meaning
of Nasdaq corporate governance standards. Under Nasdaq corporate governance standards, a 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 not to comply with certain
corporate governance requirements, including the requirements that:
| ● | we
have a board that includes a majority of “independent directors,” as defined
under the rules of Nasdaq; |
| ● | we have a compensation committee of our board of directors that is comprised entirely of independent directors with a written charter
addressing the committee’s purpose and responsibilities; and |
| ● | to the extent that we have one, we expect our nominating and corporate governance committee to be comprised entirely of independent
directors with a written charter addressing the committee’s purpose and responsibilities |
We do not intend to utilize these exemptions and
intend to comply with the corporate governance requirements of Nasdaq, subject to applicable phase-in rules. However, if we determine
in the future to utilize some or all of these exemptions, you will not have the same protections afforded to shareholders of companies
that are subject to all of Nasdaq corporate governance requirements.
Risks Associated with Acquiring and Operating a Business in Foreign
Countries, in Particular in Latin America
If we effect our initial business combination
with a company located outside of the United States, we would be subject to a variety of additional risks that may adversely affect us.
We intend to pursue a target company with operations
or opportunities outside of the United States for our initial business combination, which may subject us to additional burdens in connection
with investigating, agreeing to and completing such initial business combination, and if we effect such initial business combination,
we would be subject to a variety of additional risks that may negatively impact our operations.
If we pursue a target a company with operations
or opportunities outside of the United States for our initial business combination, we would be subject to risks associated with cross-border
business combinations, including in connection with investigating, agreeing to and completing our initial business combination, conducting
due diligence in a foreign jurisdiction, having such transaction approved by any local governments, regulators or agencies and changes
in the purchase price based on fluctuations in foreign exchange rates.
If we effect our initial business combination
with such a company, we would be subject to any special considerations or risks associated with companies operating in an international
setting, including any of the following:
| ● | costs
and difficulties inherent in managing cross-border business operations, including differences
between U.S. GAAP and the International Accounting Standards; |
| ● | rules and regulations regarding currency redemption; |
| ● | complex corporate withholding taxes on individuals; |
| ● | laws governing the manner in which future business combinations may be effected; |
| ● | exchange listing and/or delisting requirements; |
| ● | tariffs and trade barriers; |
| ● | regulations related to customs and import/export matters; |
| ● | local or regional economic policies and market conditions; |
| ● | unexpected changes in regulatory requirements; |
| ● | challenges in managing and staffing international operations; |
| ● | tax issues, such as tax law changes and variations in tax laws as compared to the United States; |
| ● | currency fluctuations and exchange controls; |
| ● | challenges in collecting accounts receivable; |
| ● | cultural and language differences; |
| ● | underdeveloped or unpredictable legal or regulatory systems; |
| ● | protection of intellectual property; |
| ● | social unrest, crime, strikes, riots and civil disturbances; |
| ● | regime changes and political upheaval; |
| ● | natural disasters and public health events; |
| ● | terrorist attacks and wars; and |
| ● | deterioration of political relations with the United States. |
We may not be able to adequately address these
additional risks. If we were unable to do so, we may be unable to complete such initial business combination, or, if we complete such
initial business combination, our operations might suffer, either of which may adversely impact our business, financial condition and
results of operations.
If our management following our initial business
combination is unfamiliar with United States securities laws, they may have to expend time and resources becoming familiar with such laws,
which could lead to various regulatory issues.
Following our initial business combination, our
management may resign from their positions as officers or directors of the company and the management of the target business at the time
of the business combination will remain in place. Management of the target business may not be familiar with United States securities
laws. If new management is unfamiliar with United States securities laws, they may have to expend time and resources becoming familiar
with such laws. This could be expensive and time-consuming and could lead to various regulatory issues which may adversely affect our
operations.
After our initial business combination, substantially
all of our assets may be located in a foreign country and substantially all of our revenue will be derived from our operations in such
country. Accordingly, our results of operations and prospects will be subject, to a significant extent, to the economic, political and
social conditions and government policies, developments and conditions in the country in which we operate.
The economic, political and social conditions,
as well as government policies, of the country in which our operations are located could affect our business. Economic growth could be
uneven, both geographically and among various sectors of the economy and such growth may not be sustained in the future. If in the future
such country’s economy experiences a downturn or grows at a slower rate than expected, there may be less demand for spending in
certain industries. A decrease in demand for spending in certain industries could materially and adversely affect our ability to find
an attractive target business with which to consummate our initial business combination and if we effect our initial business combination,
the ability of that target business to become profitable.
We will be exposed to certain risks that are
particular to investing in Latin America and other emerging markets.
In seeking significant investment exposure in
Latin American countries, we are subject to political, economic, legal, operational and other risks that are inherent to operating and
investing in these countries. These risks range from challenges in finding suitable acquisition targets to difficulties in settling transactions
markets and operating businesses once acquired. Countries in Latin America have, at times and to varying degrees, experienced periods
of economic contraction, political instability, civil strife, organized crime, corruption and other adverse conditions. The economies
of these countries are susceptible to fluctuations in certain global commodity prices and are also impacted by adverse developments in
other markets. Additionally, countries in the region tend to have significant physical and digital infrastructure deficiencies, as compared
to the United States. Governments in Latin America have in the past made significant policy and regulatory shifts in response to social
pressures, including changes in taxation. Moreover, these governments have, at times, exercised a significant degree of control over the
private sector, including due to possible nationalization, expropriation, price controls and other restrictive governmental actions. We
could also face the risk that exchange or capital controls or similar restrictions imposed by foreign governmental authorities may restrict
our ability to convert local currency received or held by us in their countries into U.S. dollars or other currencies, or to take those
dollars or other currencies out of those countries.
Exchange rate fluctuations and currency policies
may cause a target business’ ability to succeed in the international markets to be diminished.
In the event we acquire a non-U.S. target, all
revenues and income would likely be received in a foreign currency, and the dollar equivalent of our net assets and distributions, if
any, could be adversely affected by reductions in the value of the local currency. The value of the currencies in our target regions fluctuate
and are affected by, among other things, changes in political and economic conditions. Any change in the relative value of such currency
against our reporting currency may affect the attractiveness of any target business or, following consummation of our initial business
combination, our financial condition and results of operations. Additionally, if a currency appreciates in value against the dollar prior
to the consummation of our initial business combination, the cost of a target business as measured in dollars will increase, which may
make it less likely that we are able to consummate such transaction.
We are subject to changing law and regulations
regarding regulatory matters, corporate governance and public disclosure that have increased both our costs and the risk of non-compliance.
We are subject to rules and regulations by various
governing bodies, including, for example, the U.S. Securities and Exchange Commission, which are charged with the protection of investors
and the oversight of companies whose securities are publicly traded, and to new and evolving regulatory measures under applicable law.
Our efforts to comply with new and changing laws and regulations have resulted in and are likely to continue to result in, increased general
and administrative expenses and a diversion of management time and attention from revenue-generating activities to compliance activities.
Moreover, because these laws, regulations and
standards are subject to varying interpretations, their application in practice may evolve over time as new guidance becomes available.
This evolution may result in continuing uncertainty regarding compliance matters and additional costs necessitated by ongoing revisions
to our disclosure and governance practices. If we fail to address and comply with these regulations and any subsequent changes, we may
be subject to penalty and our business may be harmed.
We employ a mail forwarding service, which may
delay or disrupt our ability to receive mail in a timely manner.
Mail addressed to the company and received at
its registered office will be forwarded unopened to the forwarding address supplied by the company to be dealt with. None of the company,
its directors, officers, advisors or service providers (including the organization which provides registered office services in the Cayman
Islands) will bear any responsibility for any delay howsoever caused in mail reaching the forwarding address, which may impair your ability
to communicate with us.
After our initial business combination, it is
possible that a majority of our directors and officers will live outside the United States and all of our assets will be located outside
the United States; therefore, investors may not be able to enforce federal securities laws or their other legal rights.
It is possible that after our initial business
combination, a majority of our directors and officers will reside outside of the United States and all of our assets will be located outside
of the United States. As a result, it may be difficult, or in some cases not possible, for investors in the United States to enforce their
legal rights, to effect service of process upon all of our directors or officers or to enforce judgments of United States courts predicated
upon civil liabilities and criminal penalties on our directors and officers under United States laws.
Certain Factors Relating to Latin America
Governments have a high degree of influence
in the economies in which we plan to operate. The effects of this influence and political and economic conditions in Latin America could
harm us and the trading price of our Class A ordinary shares.
Governments in many of the markets in which we
currently, or may in the future, operate, frequently exercise significant influence over their respective economies and occasionally makes
significant changes in policy and regulations. Government actions to control inflation and other policies and regulations have often involved,
among other measures, increases or decreases in interest rates, changes in fiscal policies, wage and price controls, foreign exchange
rate controls, blocking access to bank accounts, currency devaluations, capital controls and import and export restrictions. We have no
control over and cannot predict what measures or policies governments may take in the future. We and the market price of our securities
may be harmed by changes in government policies, as well as general economic factors, including, without limitation:
| ● | growth or downturn of the relevant economy; |
| ● | interest rates and monetary policies; |
| ● | exchange rates and currency fluctuations; |
| ● | liquidity of the capital and lending markets; |
| ● | import and export controls; |
| ● | exchange controls and restrictions on remittances abroad and payments of dividends; |
| ● | modifications to laws and regulations according to political, social and economic interests; |
| ● | fiscal policy and changes in tax laws and related interpretations by tax authorities; |
| ● | economic, political and social instability, including general strikes and mass demonstrations; |
| ● | the regulatory framework governing the financial services industry; |
| ● | labor and social security regulations; |
| ● | energy and water shortages and rationing; |
| ● | public health, including as a result of epidemics and pandemics, such as the COVID-19 pandemic; |
| ● | changes in demographics; and |
| ● | other political, diplomatic, social and economic developments in or affecting Latin America. |
Uncertainty over whether Latin American governments
will implement reforms or changes in policy or regulation affecting these or other factors in the future may affect economic performance
and contribute to economic uncertainty in Latin America, such as increased tax uncertainty regarding the tax authorities’ interpretations
of applicable tax laws and exemptions, which may have an adverse effect on our activities and consequently our operating results, and
may also adversely affect the trading price of our Class A ordinary shares.
Recent economic and political instability in Brazil,
for instance, has led to a general negative perception of the Brazilian economy and higher volatility in the Brazilian securities markets,
which also may adversely affect us and our Class A ordinary shares. See “—The ongoing economic uncertainty and political instability
in Brazil, including as a result of ongoing corruption investigations, may harm us and the price of our Class A ordinary shares.”
Developments and the perceptions of risks in
other countries, including other emerging markets, the United States and Europe, may harm the economy of the countries in which we operate
and the trading price of our Class A ordinary shares.
The market for securities offered by companies
with significant operations in Latin America is influenced by political, economic and market conditions in the region and, to varying
degrees, market conditions in other emerging markets, as well as the United States, Europe and other countries. To the extent the conditions
of the global markets or economy deteriorate, the business of companies with significant operations in Latin America may be harmed. The
weakness in the global economy has been marked by, among other adverse factors, lower levels of consumer and corporate confidence, decreased
business investment and consumer spending, increased unemployment, reduced income and asset values in many areas, reduction of China’s
growth rate, currency volatility and limited availability of credit and access to capital, in addition to significant uncertainty results
from the current COVID-19 pandemic. Developments or economic conditions in other emerging market countries have at times significantly
affected the availability of credit to companies with significant operations in Latin America and resulted in considerable outflows of
funds from Latin American countries, decreasing the amount of foreign investments in the region.
Crises and political instability in other emerging
market countries, the United States, Europe or other countries, including increased international trade tensions and protectionist policies,
could decrease investor demand for securities offered by companies with significant operations in Brazil and Latin America, such as our
Class A ordinary shares. For example, in 2019, political and social unrest in Latin American countries, including Ecuador, Chile, Bolivia
and Colombia, sparked political demonstrations and, in some instances, violence. In October 2019, presidential elections were held in
Bolivia, Uruguay and Argentina. Controversial outcomes in Bolivia and Uruguay led to violent protests and claims of fraudulent elections
in Bolivia and a runoff election in Uruguay. Similarly, Chile experienced political unrest and social strife, including a wave of protests
and riots, beginning on October 18, 2019, sparked by an increase in the subway fare of the Santiago Metro and widened to reflect
anger over living costs and inequality. These developments, as well as potential crises and other forms of political instability or any
other as of yet unforeseen development, may harm our business and the trading price of our Class A ordinary shares.
The ongoing military conflict between Russia
and Ukraine may have repercussions on the world’s geopolitical and economic scenarios.
The ongoing military conflict between Russia and
Ukraine has provoked strong reactions from the United States, the UK, the EU and various other countries around the world, including from
the members of the North Atlantic Treaty Organization, or “NATO.” Following Russia’s invasion of Ukraine beginning on
February 24, 2022, the United States, the UK, the EU and other countries announced broad economic sanctions against Russia, including
financial measures such as freezing Russia’s central bank assets, limiting its ability to access its dollar reserves, the US, the
EU and the UK have also banned people and businesses from dealings with the Russian central bank, its finance ministry and its wealth
funds, selected Russian banks will also be removed from Swift messaging system, which enables the smooth transfer of money across borders.
Other sanctions by the UK include major Russian banks from the UK financial system, stopping them from accessing sterling and clearing
payments, excluding major Russian companies and the state will be stopped from raising finances or borrowing money on the UK markets,
and establishment of limits on deposits Russians can make at UK banks. The US, the EU and the UK adopted personal measures, such as sanctions
on individuals with close ties to Mr. Putin, and placed visa restrictions on several oligarchs, as well as their family members and close
associates, and froze their assets.
While the precise effect of the ongoing armed
conflict and these sanctions on the Russian and global economies remains uncertain, should tensions continue to increase, markets may
face continued volatility as well as economic and security consequences including, but not limited to, supply shortages of different kinds,
increases in prices of commodities, including piped gas, oil and agricultural goods, among others. Given that Russia and Ukraine are among
the largest grain exporters in the world, impacts on financial markets, inflation, interest rates, unemployment and other matters could
affect the global economy that is currently recovering from the effects of the COVID-19 pandemic. Particularly, these effects could result
in increased inflation in Brazil and in measures by the Brazilian government to contain inflation, such as raising the basic interest
rate, which could materially impact the cost of debt and third-party capital for financing and investing activities across industries.
Other potential consequences include, but are
not limited to, growth in the number of popular uprisings in the region, increased political discontent, especially in the regions most
affected by the conflict or economic sanctions, an increase in cyberterrorism activities and attacks, exodus to regions close to the areas
of conflict and an increase in the number of refugees fleeing across Europe, among other unforeseen social and humanitarian effects.
As our target business may operate globally, the
adverse effects—global or localized—of the ongoing conflict between Russia and Ukraine, and/or economic sanctions and import
and/or export controls to be imposed on the Russian government by the United States, the UK, the EU or others, could materially affect
our operations, expansion plans, and ultimately our results.
The ongoing economic uncertainty and political
instability in Brazil, including as a result of ongoing corruption investigations, may harm us and the price of our Class A ordinary shares.
Brazil’s political environment has historically
influenced, and continues to influence, the performance of the country’s economy. Political crises have affected and continue to
affect the confidence of investors and the general public, which have historically resulted in economic deceleration and heightened volatility
in the securities offered by companies with significant operations in Brazil.
The recent economic instability in Brazil have
contributed to a decline in market confidence in the Brazilian economy. Various ongoing investigations into allegations of money laundering
and corruption being conducted by the Office of the Brazilian Federal Prosecutor, including the largest of such investigations, known
as “Operação Lava Jato,” have negatively impacted the Brazilian economy and political environment. The
potential outcome of these investigations is uncertain, but they have already had an adverse impact on the image and reputation of the
implicated companies, and on the general market perception of the Brazilian economy. We cannot predict whether the ongoing investigations
will result in further political and economic instability, or if new allegations against government officials and/or executives of private
companies will arise in the future. A number of senior politicians, including current and former members of Congress and the Executive
Branch, and high-ranking executive officers of major corporations and state-owned companies in Brazil were arrested, convicted of various
charges relating to corruption, entered into plea agreements with federal prosecutors and/or have resigned or been removed from their
positions as a result of these Lava Jato investigations. These individuals are alleged to have accepted bribes by means of kickbacks on
contracts granted by the government to several infrastructure, oil and gas and construction companies. The profits of these kickbacks
allegedly financed the political campaigns of political parties, for which funds were unaccounted or not publicly disclosed. These funds
were also allegedly directed toward the personal enrichment of certain individuals. The effects of Lava Jato as well as other ongoing
corruption-related investigations resulted in an adverse impact on the image and reputation of the companies that have been implicated
as well as on the general market perception of the Brazilian economy, political environment and capital markets. We have no control over,
and cannot predict, whether such investigations or allegations will lead to further political and economic instability or whether new
allegations against government officials will arise in the future.
It is expected that the current Brazilian federal
government may propose certain reforms to stimulate the economy and reduce the forecasted budget deficit for 2021 and following years,
but it is uncertain whether the Brazilian government will be able to gather the required support in the Brazilian Congress to pass additional
specific reforms. We cannot predict which policies the Brazilian federal government may adopt or change or the effect that any such policies
might have on our business and on the Brazilian economy. In addition, the Brazilian government is incurring significant levels of debt
to finance measures to combat the COVID-19 pandemic which is expected to increase the Brazilian budget deficit. Any new policies
or changes to current policies, including measures to combat the COVID-19 pandemic, may have a material adverse impact on our
business, results of operations, financial condition and prospects.
Any of the above factors may create additional
political uncertainty, which could harm the Brazilian economy and, consequently, our business, and could adversely affect our financial
condition, results of operations and the trading price of our Class A ordinary shares.
Inflation and government measures to curb inflation
may adversely affect the economies and capital markets in some of the countries in which we operate, and as a result, harm our business
and the trading price of our Class A ordinary shares.
In the past, high levels of inflation have adversely
affected the economies and financial markets of some of the countries in which we operate, particularly Argentina and Brazil, and the
ability of their governments to create conditions that stimulate or maintain economic growth. Moreover, governmental measures to curb
inflation and speculation about possible future governmental measures have contributed to the negative economic impact of inflation and
have created general economic uncertainty and heightened volatility in the capital markets. As part of these measures, governments have
at times maintained a restrictive monetary policy and high interest rates that have limited the availability of credit and economic growth.
According to the National Consumer Price Index
(Índice Nacional de Preços ao Consumidor Amplo), or IPCA, which is published by the Brazilian Institute for Geography
and Statistics (Instituto Brasileiro de Geografia e Estatística), or IBGE, Brazilian inflation rates were 10.1%, 4.5% and
4.3% for the years ended as of December 31, 2021, 2020 and 2019, respectively. Brazil may experience high levels of inflation in
the future and inflationary pressures may lead to the Brazilian government’s intervening in the economy and introducing policies
that could harm our business and the trading price of our Class A ordinary shares. One of the tools used by the Brazilian government to
control inflation levels is its monetary policy, specifically relating to interest rates. An increase in the interest rate restricts the
availability of credit and reduces economic growth, and vice versa. During recent years there has been significant volatility in the official
Brazilian interest rate, which ranged from 14.25% on December 31, 2015, to 2.00% on December 31, 2020. This rate is set by the
Monetary Policy Committee of the Central Bank (Comitê de Política Monetária), or COPOM. On February 7,
2018, the Monetary Policy Committee reduced the base interest rate (Sistema Especial de Liquidação e Custódia,
or SELIC rate) to 6.75% and further reduced the SELIC rate to 6.50% on March 22, 2018. The Monetary Policy Committee reconfirmed
the SELIC rate of 6.50% on May 16, 2018 and subsequently on June 20, 2018. As of December 31, 2018, the SELIC rate was
6.50%. The Monetary Policy Committee reconfirmed the SELIC rate of 6.50% on February 6, 2019, but reduced the SELIC rate to 6.00%
on August 1, 2019, further reduced the rate to 5.50% on October 30, 2019 and further reduced the rate to 4.50% on December 12,
2019. On February 6, 2020, the Monetary Policy Committee reduced the SELIC rate to 4.25%, on March 19, 2020, further reduced
the rate to 3.75%, on May 7, 2020, further reduced the rate to 3.00%, on June 18, 2020, further reduced the rate to 2.25% and on August 6,
2020, further reduced the rate to 2.00%. On March 18, 2021, the Monetary Policy Committee raised the SELIC rate to 2.75% and further raised
the rate to 3.50% on May 5, 2021, to 5.25% on August 4, 2021, to 6.25% on September 22, 2021, to 7.75% on October 28, 2021, to 9.25% as
of December 19, 2021, to 10.75% on February 2, 2022 and to 11.75% on March 16, 2022. As of March 31, 2022, the SELIC rate was 11.75%.
Conversely, more lenient government and Central Bank policies and interest rate decreases have triggered and may continue to trigger increases
in inflation and, consequently, growth volatility and the need for sudden and significant interest rate increases, which could negatively
affect us and increase our target business indebtedness. Any change in interest rates, in particular any volatile swings, could adversely
affect our growth, results of operations and financial condition, as well as our target business.
In addition, as of July 1, 2018, Argentina
is considered highly inflationary under U.S. GAAP. Although inflation rates in certain of the other countries in which we operate have
been relatively low in the recent past, we cannot assure you that this trend will continue. The measures taken by the governments of these
countries to control inflation have often included maintaining a tight monetary policy with high interest rates, thereby restricting the
availability of credit and retarding economic growth. Inflation, measures to combat inflation and public speculation about possible additional
actions have also contributed materially to economic uncertainty in many of these countries and to heightened volatility in their securities
markets. Periods of higher inflation may also slow the growth rate of local economies that could lead to reduced demand for the products
and services of our target business. Inflation is also likely to increase some costs and expenses of our target business, which the target
business may not be able to fully pass on to customers and which could adversely affect our operating margins and operating income.
Exchange rate instability may have adverse effects
on the Brazilian economy, our business and the trading price of our Class A ordinary shares.
Our functional currency is the U.S. dollar. The
Brazilian currency has been historically volatile and has been devalued frequently over the past three decades. Throughout this period,
the Brazilian government has implemented various economic plans and used various exchange rate policies, including sudden devaluations,
periodic mini-devaluations (during which the frequency of adjustments has ranged from daily to monthly), exchange controls, dual exchange
rate markets and a floating exchange rate system. Although long-term depreciation of the Brazilian real is generally linked to
the rate of inflation in Brazil, depreciation of the real occurring over shorter periods of time has resulted in significant variations
in the exchange rate between the real, the U.S. dollar and other currencies. In 2014, the real depreciated by 11% against
the U.S. dollar, while in 2015 it further depreciated by 45%. The real/U.S. dollar exchange rate reported by the Central Bank was
R$3.259 per US$1.00 on December 31, 2016, an appreciation of 19% against the rate of R$3.905 per US$1.00 reported on December 31,
2015. In 2017, the real depreciated by 1%, with the exchange rate reaching R$3.308 per US$1.00 on December 31, 2017. In 2018,
the real depreciated an additional 18%, to R$3.875 per US$1.00 on December 31, 2018. In 2019, the real depreciated
an additional 4% to R$4.031 per US$1.00 on December 31, 2019. The real/U.S. dollar exchange rate reported by the Central Bank
was R$5.197 per US$1.00 on December 31, 2020, which reflected a 29% depreciation of the real against the U.S. dollar during
2020 due primarily to the impact of the COVID-19 pandemic on the Brazilian economy. The real/U.S. dollar exchange rate reported
by the Central Bank was R$5.581 per US$1.00 on December 31, 2021, which reflected a 7% depreciation of the real against the
U.S. dollar during 2021 due primarily to the impact of the COVID-19 pandemic on the Brazilian economy. As of March 30, 2022, the real/U.S.
dollar exchange rate reported by the Central Bank was R$4.749 per US$1.00, an appreciation of 14.9% of the real since December 31,
2021. There can be no assurance that the real will not appreciate or further depreciate against the U.S. dollar or other currencies
in the future.
A devaluation of the real relative to the
U.S. dollar could create inflationary pressures in Brazil and cause the Brazilian government to, among other measures, increase interest
rates. Any depreciation of the real may generally restrict access to the international capital markets. It would also reduce the
U.S. dollar value of our results of operations. Restrictive macroeconomic policies could reduce the stability of the Brazilian economy
and harm our results of operations and profitability. In addition, domestic and international reactions to restrictive economic policies
could have a negative impact on the Brazilian economy. These policies and any reactions to them may harm us by curtailing access to foreign
financial markets and prompting further government intervention. A devaluation of the real relative to the U.S. dollar may also,
as in the context of the current economic slowdown, decrease consumer spending, increase deflationary pressures and reduce economic growth.
On the other hand, an appreciation of the real
relative to the U.S. dollar and other foreign currencies may deteriorate the Brazilian foreign exchange current accounts. Depending on
the circumstances, either devaluation or appreciation of the real relative to the U.S. dollar and other foreign currencies could
restrict the growth of the Brazilian economy, and affect our business, results of operations and profitability.
We will be subject to significant foreign currency
exchange controls and currency devaluation in certain countries in which we may operate.
Certain Latin American economies have experienced
shortages in foreign currency reserves and their respective governments have adopted restrictions on the ability to transfer funds out
of the country and convert local currencies into U.S. dollars. This may increase our costs and limit our ability to convert local currency
into U.S. dollars and transfer funds out of certain countries, including for the purchase of dollar-denominated inputs, the payment of
dividends or the payment of interest or principal on our outstanding debt. In the event that any of our subsidiaries may be unable to
transfer funds to us in the future due to currency restrictions, we are responsible for any resulting shortfall.
Since September 2019, the current Argentine government
has tightened restrictions on capital flows and imposed exchange controls and transfer restrictions, substantially limiting the ability
of companies to retain foreign currency or make payments outside of Argentina. Furthermore, the Central Bank of Argentina implemented
regulations requiring its prior approval for certain foreign exchange transactions otherwise authorized to be carried out under the applicable
regulations, such as dividend payments or repayment of principal of inter-company loans as well as the import of goods. As a consequence
of the re-imposition of exchange controls, the spread between the official exchange rate and other exchange rates resulting implicitly
from certain capital market operations usually effected to obtain U.S. dollars has broadened significantly. The implementation of the
above-mentioned measures could impact our ability to transfer funds outside of Argentina in the future and may prevent or delay payments
that Argentine portfolio companies may be required to make outside Argentina, if any. As a result, if we are prohibited from transferring
funds out of Argentina, or if we become subject to similar restrictions in other countries in which we operate, our results of operations
and financial condition could be materially adversely affected. In addition, the continuing devaluation of the Argentine peso since the
end of 2015 has led to higher inflation levels, has significantly reduced competitiveness, real wages and consumption and has had a negative
impact on businesses whose success is dependent on domestic market demand and supplies payable in foreign currency. Further currency devaluations
in any of the countries in which we operate could have a material adverse effect on our results of operations and financial condition.
We and our target business are subject to review
by taxing authorities, and an incorrect interpretation by us of tax laws and regulations may have a material adverse effect on us.
Our activities will require the use of estimates
and interpretations of complex tax laws and regulations and are subject to review by taxing authorities. We and our target business may
be subject to the income and investment tax laws of Brazil and the other jurisdictions in which we expect to operate. These tax laws are
complex and subject to different interpretations by the taxpayer and relevant governmental taxing authorities, leading to disputes which
are sometimes subject to prolonged evaluation periods until a final resolution is reached. In making investment decisions or in establishing
a provision for income tax expense and filing returns, we must make judgments and interpretations about the application of these inherently
complex tax laws. If the judgments, estimates and assumptions we use in making our investment decisions or in preparing our tax returns
are subsequently found to be incorrect, there could be a material adverse effect on our business and results of operations. The interpretations
of Brazilian taxing authorities and the other jurisdictions in which we operate are unpredictable and frequently involve litigation, which
introduces further uncertainty and risk as to tax expense.
Infrastructure and workforce deficiencies in
Latin America may impact economic growth and have a material adverse effect on us and our target business.
After our business combination, our performance
will depend in part on the overall health and growth of the Latin American economy, especially in Brazil. Brazilian GDP growth has fluctuated
over the past few years, with contractions of 3.5% and 3.3% in 2015 and 2016, respectively, followed by growth of 1.3%, 1.8% and 1.4%
in 2017, 2018 and 2019, respectively. In 2020, Brazilian GDP contracted by 4.1%. Growth is limited by inadequate infrastructure, including
potential energy shortages and deficient transportation, logistics and telecommunication sectors, general strikes, the lack of a qualified
labor force, and the lack of private and public investments in these areas, which limit productivity and efficiency. Additionally, despite
our plans to adopt business continuity and crisis management policies, travel restrictions or potential impacts on personnel due to the
COVID-19 pandemic may disrupt our target business operations and the markets in which it operates. Any of these factors could lead to
labor market volatility and generally impact income, purchasing power and consumption levels, which could limit growth and ultimately
have a material adverse effect on us and our target business.
The COVID-19 pandemic is expected to continue
to have a negative impact on global, regional and national economies, and we would be materially adversely affected by a protracted economic
downturn.
The ongoing COVID-19 pandemic is expected to continue
to have a negative impact on global, regional and national economies and to disrupt supply chains and otherwise reduce international trade
and business activity. Reflecting this, the COVID-19 pandemic has already caused, since February 2020, the levels of equity and other
financial markets to decline sharply and to become volatile, and such effects may continue or worsen in the future. This may in turn further
impact the stock market and private equity markets in Brazil and elsewhere in Latin America, which may impact our future business in Latin
America and our resulting business combination operations. The market declines and volatility could negatively impact our operations causing
us to incur losses as well as result in the postponement or cancellation of expansion plans or mergers and acquisitions thereby reducing
our future growth prospects, among others. The economic slowdown and market downturn could also negatively impact our target business
performance through lower demand for its products or services and higher than expected losses, potentially leading our investors to redirect
investments away from us. The ongoing COVID-19 pandemic and its continued impact on the global economy may affect our ability to meet
our financial targets or business combination. While it is too early for us to predict the impacts on our target business or our financial
targets that the pandemic, and the governmental responses to it, may have, we would be materially adversely affected by a protracted downturn
in local, regional or global economic conditions.