ITEM
1. BUSINESS.
Introduction
We
are a blank check company incorporated on May 27, 2020 as a Delaware corporation for the purpose of effecting a merger, capital
stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses.
Although we are not limited to a particular industry or geographic region for purposes of consummating a business combination,
we initially concentrated on target businesses making a positive contribution to sustainability through the ownership, financing
and management of societal infrastructure.
Formation
On
May 27, 2020, our sponsor paid $25,000 to cover certain offering costs in consideration of 8,625,000 founder shares. The founder
shares included an aggregate of up 1,125,000 shares subject to forfeiture to the extent that the underwriters’ over-allotment
option was not exercised in full or in part, so that our sponsor would own 20% of our issued and outstanding shares after our
initial public offering (assuming our sponsor did not purchase any public shares in our IPO). On August 27, 2020, as a result
of the underwriters’ election to partially exercise their over-allotment option and the forfeiture of the remaining over-allotment
option, 638,664 founder shares were forfeited and 486,336 founder shares ceased to be subject to forfeiture, resulting in an aggregate
of 7,986,336 founder shares issued and outstanding.
Initial
Public Offering
On
August 20, 2020, we consummated our IPO of 30,000,000 units, at $10.00 per unit, generating gross proceeds of $300,000,000,
with each unit consisting of one share of common stock and one-half of one redeemable warrant. Each warrant will become exercisable
for one share of common stock, with an exercise price of $11.50 per share, at any time commencing on the later of 12 months
from the closing of our IPO or 30 days after the completion of an initial business combination and will expire on the fifth anniversary
of our completion of an initial business combination, or earlier upon redemption or liquidation. Simultaneously with the closing
of our IPO, NGA consummated the sale of 7,750,000 private placement warrants at a price of $1.00 per Private Placement Warrant
in a private placement to our sponsor generating gross proceeds of $7,750,000. On August 27, 2020, in connection with the
underwriters’ election to partially exercise their over-allotment option in our IPO, NGA sold an additional 1,945,344 units
at $10.00 per unit and sold an additional 389,069 private placement warrants to our sponsor, at a price of $1.00 per Private Placement
Warrant, generating gross proceeds of $19,842,509.
The
private placement warrants are identical to the public warrants sold in our IPO, except that the private placement warrants are
non-redeemable and may be exercised on a cashless basis, in each case so long as they continue to be held by our sponsor or its
permitted transferees. Our sponsor has agreed not to transfer, assign, or sell any of the private placement warrants and underlying
shares of common stock (except to certain permitted transferees) until 30 days after the consummation of our initial business
combination.
Proposed
Business Combination
On
November 30, 2020, we entered into a business combination agreement and plan of reorganization (the “Business Combination
Agreement”) with The Lion Electric Company, a corporation existing under the Business Corporations Act (Québec) (“Lion
Electric”), and Lion Electric Merger Sub Inc., a Delaware corporation and wholly owned subsidiary of Lion Electric (“Merger
Sub”), pursuant to which Merger Sub will be merged with and into the Company (the “Merger,” together with the
other transactions related thereto, the “Proposed Lion Transaction”), with the Company surviving the Merger as a wholly
owned subsidiary of Lion Electric (the “Surviving Corporation”).
Consummation
of the transactions contemplated by the Business Combination Agreement is subject to customary conditions of the respective parties,
including the approval of the Proposed Lion Transaction by the Company’s stockholders in accordance with the Company’s
certificate of incorporation.
In
connection with the execution of the Business Combination Agreement, the Company and Lion Electric entered into separate subscription
agreements (collectively, the “Subscription Agreements”) with a number of investors (the “Subscribers”),
pursuant to which the Subscribers agreed to purchase, and Lion Electric agreed to sell to the Subscribers, an aggregate of 20,040,200
Lion Electric Common Shares (the “PIPE Shares”), for a purchase price of $10.00 per share and an aggregate purchase
price of $200,402,000, in a private placement (the “PIPE”). The closing of the sale of the PIPE Shares pursuant to
the Subscription Agreements is contingent upon, among other customary closing conditions, the concurrent consummation of the Proposed
Lion Transaction. The purpose of the PIPE is to raise additional capital for use by Lion Electric following the closing.
In
connection with the Business Combination Agreement, the Company, Lion Electric, and our sponsor entered into the Stockholder Support
and Lock-Up Agreement (the “Stockholder Support Agreement”) pursuant to which our sponsor agreed to vote all of its
shares of common stock in favor of the approval and adoption of the Proposed Lion Transaction. Additionally, our sponsor agreed,
among other things, not to (a) transfer any of its shares of common stock or warrants, or any Lion Electric common shares or warrants
acquired in exchange therefor pursuant to the Proposed Lion Transaction, for certain periods of time as set forth in the Stockholder
Support Agreement, subject to certain customary exceptions or (b) enter into any voting arrangement that is inconsistent with
the commitment under the Stockholder Support Agreement to vote in favor of the approval and adoption of the Proposed Lion Transaction.
The
Business Combination Agreement and related agreements are further described in the Form 8-K filed by the Company on November 30,
2020.
On
December 31, 2020, Lion Electric filed a registration statement on Form F-4 (File No: 333-251847) (as amended, the “Lion
Registration Statement”) relating to the Business Combination. Once the SEC declares the Registration Statement effective,
we will mail the definitive proxy statement/prospectus statement relating to the special meeting of our stockholders in connection
with the Business Combination. The Business Combination is expected to close in the first quarter of 2021, subject to approval
by our stockholders and other customary closing conditions.
Other
than as specifically discussed, this report does not assume the closing of the Proposed Lion Transaction.
NYSE
Listing
The
public shares, units, and public warrants are currently listed for trading on the NYSE under the symbols “NGA,” “NGA.U,”
and “NGA.WS,” respectively. Upon the closing of the Proposed Lion Transaction described above, our securities will
be delisted from the NYSE and it is expected that Lion Electric’s common shares will be listed on the NYSE.
Business
Strategy
Our
business strategy is to identify and complete our initial business combination, like the Proposed Lion Transaction, with a company
that complements the experience of our management team and can benefit from their operating and deal expertise. Our selection
process leverages our management team’s network of relationships, deal sourcing capability and unique industry experiences
to access a wide range of proprietary opportunities. The team members have developed these capabilities during their respective
career endeavors which have included, for Mr. Michael Hoffman, pursuing a distinguished career in originating and completing successful
renewable energy investments for recognized private equity firms and for Mr. Ian Robertson, building Algonquin Power & Utilities
Corp. into a broad-based power and utility infrastructure company recognized as one of the most sustainable companies globally.
Our management team has a history of sourcing, structuring, acquiring, operating, developing, growing, financing and selling businesses.
They also share deep relationships with target companies and capital markets advisors, as well as extensive experience raising
both debt and equity capital across business cycles. These experiences have provided them with a broad understanding of public
market performance and investor expectations, enhancing their ability to provide mentorship as a target management team transitions
from private to public markets.
Initial
Business Combination
The
NYSE rules require that our initial business combination must be with one or more target businesses that together have a fair
market value equal to at least 80% of the balance in the trust account (less any deferred underwriting commissions and taxes payable
on interest earned) at the time of our signing a definitive agreement in connection with our initial business combination. If
our board of directors is not able to determine the fair market value of the target business or businesses, we will obtain an
opinion from an independent investment banking firm or from another independent entity that commonly renders valuation opinions,
with respect to the satisfaction of such criteria. However, we will not be required to meet this condition if we are not then
listed on the NYSE.
We
anticipate structuring our initial business combination so that the post-transaction company in which our public stockholders
own shares will own or acquire 100% of the outstanding equity interests or assets of the target business or businesses. We may,
however, structure our initial business combination such that the post- transaction company owns or acquires less than 100% of
such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders
or for other reasons, but we anticipate only completing such business combination if the post-transaction company owns or acquires
50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient
for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction
company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to our initial business combination
may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us
in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of
new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling
interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately
prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business
combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the
post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes
of the NYSE’s 80% fair market value test. If our initial business combination involves more than one target business, the
80% fair market value test will be based on the aggregate value of all of the target businesses.
Our
Acquisition Process
In
evaluating a prospective target business, such as Lion Electric, we conduct a thorough due diligence review that will encompass,
among other things, meetings with incumbent management and employees, document reviews, inspection of facilities, as well as a
review of financial and other information that will be made available to us. We also utilize our operational and capital allocation
experience.
We
are not prohibited from pursuing an initial business combination with a company that is affiliated with our initial stockholders,
sponsor, officers or directors. While Lion Electric is not affiliated with our sponsor, officers or directors, in the event we
do not consummate the Proposed Lion Transaction and seek to complete our initial business combination with a company that is affiliated
with our initial stockholders, sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion
from an independent investment banking firm or another independent entity that commonly renders valuation opinions that our initial
business combination is fair to our company from a financial point of view.
Members
of our management team and our independent directors directly or indirectly own founder shares and/or private placement warrants
and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business
with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of
interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and
directors was included by a target business as a condition to any agreement with respect to our initial business combination.
Each
of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations
to other entities pursuant to which such officer or director is or will be required to present a business combination opportunity.
Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an
entity to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or
contractual obligations to present such opportunity to such entity. We do not believe, however, that the fiduciary duties or contractual
obligations of our officers or directors will materially affect our ability to complete our business combination. Our certificate
of incorporation provides that we renounce our interest in any corporate opportunity offered to any director or officer unless
such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company and
such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue.
Our
officers had agreed not to become an officer or director of any other special purpose acquisition company which has publicly filed
a registration statement with the SEC until we entered into a definitive agreement regarding our initial business combination
or we failed to complete our initial business combination within 24 months after the closing of our IPO. Subsequent to entering
into the Business Combination Agreement with Lion Electric, our officers and directors formed Northern Genesis Acquisition Corp.
II (“Northern Genesis II”), a special purpose allocation, which completed its initial public offering on January15,
2021, and Northern Genesis Acquisition Corp. III (“Northern Genesis III”), which has filed a registration statement
on Form S-1 with the SEC for its initial public offering.
Acquisition
Criteria
We
have identified the following general criteria and guidelines that we believe are important in evaluating prospective target businesses,
such as Lion Electric, for a business combination:
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Ability
to align with our sustainability principles and support reduction of carbon intensity
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Defined
barriers to entry or sustainable competitive advantages
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Predictable
revenue and free cash flow to support reinvestment growth
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Little
material technology, scale-up or market risk and success not premised on future capital
raises to achieve growth plans
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Opportunity
to benefit from our management team’s network and expertise to drive improved financial
performance
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Ability
to benefit from access to the public capital markets
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Notwithstanding
the foregoing, these criteria and guidelines are not intended to be exhaustive. Further, we may elect to pursue a business combination
with a target business that may not meet any of the foregoing criteria and guidelines. Any evaluation relating to the merits of
a particular initial business combination may be based, to the extent relevant, on these general criteria and guidelines as well
as other considerations, factors, criteria and guidelines that our management may deem relevant. In the event that we decide to
enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will
disclose that the target business does not meet the above criteria and guidelines in our shareholder communications related to
our initial business combination, which, as discussed in this report, would be in the form of tender offer documents or proxy
solicitation materials that we would file with the SEC.
Status
as a Public Company
We
believe our structure makes us an attractive business combination partner to target businesses. As an existing public company,
we offer a target business an alternative to the traditional initial public offering through a merger or other business combination.
In this situation, the owners of the target business would exchange their shares of stock in the target business for shares of
our stock or for a combination of shares of our stock and cash, allowing us to tailor the consideration to the specific needs
of the sellers. Although there are various costs and obligations associated with being a public company, we believe target businesses
will find this method a more certain and cost effective method to becoming a public company than the typical initial public offering.
In a typical initial public offering, there are additional expenses incurred in marketing, road show and public reporting efforts
that may not be present to the same extent in connection with a business combination with us.
Furthermore,
once a proposed business combination is completed, the target business will have effectively become public, whereas an initial
public offering is always subject to the underwriters’ ability to complete the offering, as well as general market conditions,
which could delay or prevent the offering from occurring or could have negative valuation consequences. Once public, we believe
the target business would then have greater access to capital and an additional means of providing management incentives consistent
with stockholders’ interests. It can offer further benefits by augmenting a company’s profile among potential new
customers and vendors and aid in attracting talented employees.
We
are an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our
Business Startups Act of 2012 (the “JOBS Act”). 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 stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less
attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more
volatile.
In
addition, Section 107 of the JOBS Act also provides that an “emerging growth company” can take advantage of the extended
transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards.
In other words, an “emerging growth company” can delay the adoption of certain accounting standards until those standards
would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period.
We
will remain an emerging growth company until the earlier of (a) the last day of the fiscal year (i) following the fifth anniversary
of the completion of our Public Offering, (ii) in which we have total annual gross revenue of at least $1.07 billion (as adjusted
for inflation pursuant to SEC rules from time to time), or (iii) in which we are deemed to be a large accelerated filer, which
means the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last day of our most
recently completed fiscal quarter, and (b) the date on which we have issued more than $1.0 billion in non-convertible debt during
the prior three-year period.
Financial
Position
With
funds available for a business combination of approximately $308,000,000 (after payment of $11,180,870 of deferred underwriting
fees, but before fees and expenses associated with our initial business combination), we offer a target business a variety of
options such as creating a liquidity event for its owners, providing capital for the potential growth and expansion of its operations
or strengthening its balance sheet by reducing its debt ratio. Because we are able to complete our initial business combination
using our cash, debt or equity securities, or a combination of the foregoing, we have the flexibility to use the most efficient
combination that will allow us to tailor the consideration to be paid to the target business to fit its needs and desires. However,
we have not taken any steps to secure third party financing and there can be no assurance it will be available to us.
Liquidation
if No Business Combination
We
have until August 20, 2022 to complete our initial business combination. If we are unable to complete a business combination
within such period (and our stockholders have not approved an amendment to our certificate of incorporation to extend this 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 our 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 tax obligations (less up to $100,000 of interest to pay dissolution expenses), divided
by the number of our then outstanding public shares, which redemption will completely extinguish public stockholders’ rights
as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as
promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board,
dissolve and liquidate, subject in the case of clauses (ii) and (iii) to our obligations under Delaware law to provide
for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions
with respect to our warrants, which will expire worthless if we fail to complete a business combination by August 20, 2022.
Our
sponsor and our officers and directors have entered into letter agreements 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 August 20, 2022. However, if they acquire our public shares, 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 and our officers and directors have agreed, pursuant to written agreements with us, that they will
not propose any amendment to our certificate of incorporation (a) that would modify the substance or timing of our
obligation to allow redemption in connection with an initial business combination or certain amendments to our certificate of
incorporation or to redeem 100% of our public shares if we do not complete our initial business combination by
August 20, 2022 or (b) with respect to any other provision relating to stockholders’ rights or pre-initial
business combination activity, unless we provide our public stockholders with the opportunity to redeem their shares of
common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount
then on deposit in the Trust Account (including interest earned on the funds held in the Trust Account and not previously
released to us to pay our tax obligations), divided by the number of our then outstanding public shares. However, we cannot
redeem our public shares unless our net tangible assets are at least $5,000,001 either immediately prior to or upon
consummation of a business combination (so that we are not subject to the SEC’s “penny stock”
rules).
If
our funds held outside of the trust account are not sufficient to cover the costs and expenses associated with implementing a
plan of dissolution, to the extent that there is any interest accrued in the trust account not required to pay our tax obligations,
we may request the trustee to release to it an additional amount of up to $100,000 of such accrued interest to pay those costs
and expenses.
If
we expend all of the net proceeds of our initial public offering 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 our public stockholders upon our dissolution would be approximately $10.00. The proceeds 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 stockholders. We cannot assure you that the actual per-share redemption amount received by our public stockholders
will not be substantially less than $10.00. Under Section 281(b) of the DGCL, our plan of dissolution must provide for all
claims against the company to be paid in full or make provision for payments to be made in full, as applicable, if there are sufficient
assets. These claims must be paid or provided for before we make any distribution of our remaining assets to our stockholders.
While we intends 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 seek to have all vendors, service providers (other than our independent auditors), 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 any monies
held in the trust account, 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 claims based on fraudulent
inducement, breach of fiduciary responsibility or other similar claims, as well as claims challenging the enforceability of such
a 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 perform an analysis of the alternatives available to it and will only enter into an agreement with a third
party that has not executed a waiver if management believes that such third party’s engagement would be significantly more
beneficial to the company than any alternative. Examples of possible instances where we may engage a third party that refuses
to execute a waiver include the engagement of a third party consultant whose particular expertise or skills are believed by management
to be significantly superior to those of other consultants that would agree to execute a waiver or in cases where management is
unable to find a service provider willing to execute a waiver.
Our
sponsor has agreed that it will be liable to us if and to the extent any claims by a vendor for services rendered or products
sold to us, or a prospective target business with which we have discussed entering into a definitive agreement for a business
combination, reduce the amount of funds in the trust account to below $10.00 per public share, except as to any claims by a third
party who executed a waiver of any and all rights to seek access to the trust account (even if such waiver is deemed to be unenforceable)
and except as to any claims under our indemnity of the underwriters of our IPO against certain liabilities, including liabilities
under the Securities Act. We have not independently verified whether our sponsor has sufficient funds to satisfy this indemnity
obligation nor have we asked our sponsor to reserve for such eventuality, and we believe that our sponsor’s only assets
are securities of the company. Therefore, we believe it is unlikely 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 the initial business
combination and redemptions could be reduced to less than $10.00 per public share. In such event, we may not be able to complete
an initial business combination and our stockholders would receive such lesser amount per share in connection with any redemption
of our 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 proceeds in the trust account are reduced below $10.00 per public share and our sponsor asserts that it is
unable to satisfy its indemnification obligation or that it has no indemnification obligation related to a particular claim, our
independent directors would determine whether to take legal action against our sponsor to enforce its indemnification obligation.
While we currently expect that our independent directors would take legal action on our behalf against our sponsor to enforce
its indemnification obligation to us, it is possible that our independent directors in exercising their business judgment may
choose not to do so 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 claims of creditors will not reduce the actual value of the per-share redemption price to less than $10.00 per
public share.
Under
the DGCL, stockholders of a corporation may be held liable for claims by third parties against a corporation to the extent of
distributions received by them in a dissolution. The pro rata portion of our trust account distributed to our public stockholders
upon the redemption of our public shares in the event we do not complete our business combination within 24 months from the closing
of our IPO may be considered a liquidating distribution under Delaware law. If the corporation complies with certain procedures
set forth in Section 280 of the DGCL intended to ensure that it makes reasonable provision for all claims against it, including
a 60-day notice period during which any third-party claims can be brought against the corporation, a 90-day period during which
the corporation may reject any claims brought, and an additional 150-day waiting period before any liquidating distributions are
made to stockholders, any liability of stockholders with respect to a liquidating distribution is limited to the lesser of such
stockholder’s pro rata share of the claim or the amount distributed to the stockholder, and any liability of the stockholder
would be barred after the third anniversary of the dissolution. Furthermore, if the pro rata portion of our trust account distributed
to our public stockholders upon the redemption of our public shares in the event we do not complete our business combination within
24 months from the closing of our IPO, is not considered a liquidating distribution under Delaware law and such redemption distribution
is deemed to be unlawful, then pursuant to Section 174 of the DGCL, the statute of limitations for claims of creditors could
be six years after the unlawful redemption distribution, instead of three years, as in the case of a liquidating distribution.
If
we are unable to complete our business combination within 24 months from the closing of our IPO, it is our intention to redeem
the public shares as soon as reasonably possible following our 24th month and, therefore, we do not intend to comply with the
procedures provided for by Section 280 of the DGCL. As such, our stockholders potentially could be liable for any claims
to the extent of distributions received by them (but no more) and any liability of our stockholders may extend well beyond the
third anniversary of such date.
Because
we will not be complying with Section 280 of the DGCL, Section 281(b) of the DGCL requires that we adopt a plan upon
dissolution, based on facts known to us at such time, that will provide for our payment of all existing and pending claims or
claims that may be potentially brought against us within the subsequent 10 years. However, because we are a blank check company,
rather than an operating company, and our operations are limited to searching for prospective target businesses to acquire, the
only likely claims to arise would be from our vendors (such as lawyers, investment bankers, etc.) or prospective target businesses.
As described above, pursuant to the obligation contained in our underwriting agreement, we will seek to have all vendors, service
providers (other than our independent auditors and the underwriters in our IPO), 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. As a result of this obligation, the claims that could be made against us are significantly limited.
If
we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, the proceeds held
in the trust account could be subject to applicable bankruptcy law, and may be included in our bankruptcy estate and subject to
the claims of third parties with priority over the claims of our stockholders. Therefore, in the event of a bankruptcy, we cannot
assure you that we will be able to return $10.00 per share to our stockholders. Additionally, if we file a bankruptcy petition
or an involuntary bankruptcy petition is filed against us that is not dismissed, any distributions received by our stockholders
could be viewed under applicable debtor/creditor and/or bankruptcy laws as either a “preferential transfer” or a “fraudulent
conveyance.” As a result, a bankruptcy court could seek to recover all amounts received by our stockholders. Furthermore,
our board may be viewed as having breached its fiduciary duty to our creditors and/or may have acted in bad faith, and thereby
exposing itself and our company to claims of punitive damages, by paying public stockholders 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.
Competition
In
identifying, evaluating and selecting a target business for our business combination, we may encounter intense competition from
other entities having a business objective similar to ours, including other blank check companies, private equity groups and leveraged
buyout funds, and operating businesses seeking strategic acquisitions. Many of these entities are well established and have extensive
experience identifying and effecting business combinations directly or through affiliates. Moreover, many of these competitors
possess greater financial, technical, human and other resources than we do. Our ability to acquire larger target businesses will
be limited by our available financial resources. This inherent limitation gives others an advantage in pursuing the acquisition
of a target business. Furthermore, our obligation to pay cash in connection with our public stockholders who exercise their redemption
rights may reduce the resources available to us for our initial business combination and our outstanding warrants, and the future
dilution they potentially represent, may not be viewed favorably by certain target businesses. Either of these factors may place
us at a competitive disadvantage in successfully negotiating an initial business combination.
Facilities
Our
executive offices are located at 4801 Main Street, Suite 1000, Kansas City, MO 64112. The cost for our use of any office space
used by us, including this space, is included in the $10,000 per month fee we will pay to our sponsor or its affiliates for office
space, utilities, secretarial support and administrative services. We consider our current office space adequate for our current
operations.
Employees
We
do not have any full-time employees and we do not intend to have any prior to the consummation of our initial business combination.
Website
Our
website address is www.northerngenesis.com. Information contained on our website is not part of this Annual Report on Form 10-K.
Our
Annual Reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, as well as any amendments and exhibits
to these reports, filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act, are available on our website, free
of charge, as soon as reasonably practicable after such reports are filed with, or furnished to, the SEC. Alternatively, you may
access these reports at the SEC’s website at www.sec.gov.
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, including our financial statements and related notes,
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.
In
addition to the risks and uncertainties set forth below, we face certain material risks and uncertainties related to the business
combination with Lion Electric. In addition, if we succeed in effecting the proposed business combination, we will face additional
and different risks and uncertainties related to the business of Lion Electric. Such material risks are set forth in the Registration
Statement on Form F-4, as amended, which contains our preliminary proxy statement, that Lion Electric has filed with the SEC in
connection with the meeting to be called to approve the Proposed Lion Transaction.
Risks
Regarding Our Business Strategy
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We
are a newly formed blank check company with no operating history and no revenues; our
ability to source and complete an initial business combination is entirely dependent
upon the efforts of our management team.
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If,
due to our lack of revenues, other resource constraints, competition, or any other factors
we are unable to complete an initial business combination within 24 months following
the closing of our IPO, our public stockholders may receive only $10.00 per share, and
perhaps less, on the redemption of our public shares, and our warrants will expire worthless.
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The
right of our public stockholders to cause their public shares to be redeemed upon a business
combination, the significant number of warrants that we will issue, and the uncertainties
regarding the extent and amount of any redemptions of our common stock and exercise of
our warrants may make us a less attractive combination candidate than strategic or other
competitors, increasing the risk that we fail to timely complete an initial business
combination, or do so on less favorable terms.
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Business
Combination Risks
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Our
due diligence regarding any particular target may not uncover all material risks, or
identified risks may evolve in unforeseen ways, and our assessment of how management
or key personnel of a target may perform in a higher growth mode or as a public company
may be inaccurate.
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We
are not required to obtain an opinion from an independent investment banking firm or
from another independent firm that commonly renders valuation opinions, and consequently,
you may have no assurance from an independent source that the price we are paying for,
or relative valuations reflected by, a business combination is fair to our company from
a financial point of view.
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Due
to transaction structure or other reasons, our stockholders may represent a minority
of a combined business, and our management team may not control or have significant influence
over management of the target business following our initial business combination.
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Risks
Related to Our Securities and Redemption
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The
NYSE 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.
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The
determination of the offering price of our units and the size of our initial public offering
was more arbitrary than the pricing of securities and size of an offering of an operating
company in a particular industry, and you therefore may have less assurance that the
offering price of our units properly reflected their value.
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We
have not registered the shares of common stock issuable upon exercise of the warrants
under the Securities Act or any state securities laws at this time, and such
registration may not be in place when an investor desires to exercise warrants, thus
precluding such investor from being able to exercise its warrants except on a cashless
basis and potentially causing such warrants to expire worthless.
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We
may redeem your unexpired warrants prior to their exercise at a time that is disadvantageous
to you. In addition, our ability to require exercise such warrants on a cashless basis
after we call the warrants for redemption or if there is no effective registration statement
covering the shares of common stock issuable upon exercise will cause holders to receive
fewer shares of common stock upon their exercise of the warrants than they would have
received had they been able to pay the exercise price of their warrants in cash.
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You
will not have any rights or interests in funds from the trust account established with
proceeds of our IPO, except under certain limited circumstances. To liquidate your investment,
therefore, you may be forced to sell your public shares or warrants, potentially at a
loss.
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If
third parties bring claims against us, including but not limited to claims in bankruptcy,
the proceeds held in the trust account could be reduced and the per-share redemption
amount received by stockholders may be less than $10.00 per share. In addition, in certain
circumstances a bankruptcy trustee or third parties could seek to recover redemption
payments from stockholders who received such payments.
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Conflict
of Interest Risks
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Certain
of our officers and directors are now, and all of them may in the future become, affiliated
with entities engaged in business activities similar to those intended to be conducted
by us and, accordingly, may have conflicts of interest in allocating their time and determining
to which entity a particular business opportunity should be presented.
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If
the Proposed Lion Transaction is not consummated, 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 or their affiliates which may raise
potential conflicts of interest.
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Our
sponsor and our officers and directors have or may have interests in us and our securities
that differ from or are in addition to those of our stockholders generally, including
as a result of direct or indirect interests in the founders shares, private placement
warrants and working capital warrants, loans to us, and waivers of rights to receive
funds from the trust account.
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Our
key personnel may negotiate employment or consulting agreements with a target business
in connection with a particular business combination. These agreements may provide for
them to receive compensation following our 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.
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Risk
Factors
We
are a newly formed 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 newly formed company with no operating results to date. Because we lack an operating history, you have no basis upon which
to evaluate our ability to achieve our business objective of completing our initial business combination with one or more target
businesses. We may be unable to complete a business combination and, if we fail to do so, we will never generate any operating
revenues.
Past
performance may not be indicative of future performance of an investment in our securities. Further, in the event of the termination
of the Proposed Lion Transaction, we expect that the market price of our securities would immediately and materially decrease,
and there can be no assurance that we would be able to identify and consummate an alternative business combination or as to the
value of any such alternative business combination to our stockholders
Information
regarding performance by, or businesses associated with, our management team and their affiliates is presented for informational
purposes only. Any past acquisition or operational experience of our management team and their affiliates is not a guarantee either:
(i) that we will be able to consummate the Proposed Lion Transaction, (ii) that we would be able to locate a suitable alternative
candidate for, and consummate, an initial business combination; or (iii) of any results with respect to any initial business
combination we may consummate. You should not rely on the historical record of our management team’s or their affiliates’
performance as indicative of the future performance of an investment in us or the returns we will, or are likely to, generate
going forward. None of our officers and directors has had experience with blank check companies or special purpose acquisition
companies in the past.
In
the event that the Proposed Lion Transaction were to be terminated, we expect that the market price of our securities would immediately
and materially decrease, and there can be no assurance that we would be able to identify and consummate an alternative business
combination, and no assurance as to the value of any such alternative business combination to our stockholders.
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, we may be deemed to be a “blank check” company under the U.S. securities laws.
However, because we had net tangible assets in excess of $5,000,000 upon the successful completion of our IPO and 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 will not be afforded the benefits
or protections of those rules. Among other things, this means our units will be immediately tradable and we will have a longer
period of time to complete our initial business combination than do companies subject to Rule 419. Moreover, if were subject
to Rule 419, it would prohibit the release of any interest earned on funds held in the trust account to us unless and until the
funds in the trust account were released to us in connection with our completion of our initial business combination.
In
the event that the Proposed Lion Transaction were to be terminated and we enter into an alternative business combination, in some
circumstances our public stockholders may not be afforded an opportunity to vote on the proposed business combination, which means
we may complete such a business combination even though a majority of our public stockholders do not support such a combination.
Due
to the nature of the Proposed Lion Transaction, the DGCL requires approval of the Proposed Lion Transaction by the holders of
a majority of our outstanding shares of common stock. In the event that the Proposed Lion Transaction were terminated and we identified
an alternative business combination, we may not hold a stockholder vote to approve such initial business combination unless such
business combination would require stockholder approval under applicable law or stock exchange listing requirements or if we decide
to hold a stockholder vote for business or other legal reasons. Except as required by law, the decision as to whether we will
seek stockholder approval of a proposed business combination or will allow stockholders to sell their shares to us in a tender
offer will be made by us, solely in our discretion. If we decide to allow stockholders to their shares to us in a tender offer,
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
are dependent upon our executive officers and directors and their loss could adversely affect our ability to operate.
Our
operations are dependent upon a relatively small group of individuals and, in particular, our executive officers and directors.
We believe that our success depends on the continued service of our officers and directors, at least until we have completed our
initial business combination. In addition, our executive officers and directors are not required to commit any specified amount
of time to our affairs and, accordingly, will have conflicts of interest in allocating their time among various business activities,
including identifying potential business combinations and monitoring the related due diligence. We do not have an employment agreement
with, or key-man insurance on the life of, any of our directors or executive officers. The unexpected loss of the services
of one or more of our directors or executive officers could have a detrimental effect on us.
Our
limited resources and the significant competition for business combination opportunities may make it more difficult to identify
and complete an initial business combination. If we are unable to complete an initial business combination, our public stockholders
may receive only approximately $10.00 per share on our redemption of our public shares, or less than such amount in certain circumstances,
and our warrants will expire worthless.
In
the event that we are unable to consummate our proposed business combination with Lion Electric, we expect to encounter intense
competition from other entities having a business objective similar to ours, including private investors (which may be individuals
or investment partnerships), other blank check companies and other entities, 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 greater technical, human and other resources 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 will be numerous target businesses we could potentially acquire with the funds held in the trust account, our ability
to compete with respect to the acquisition of certain target businesses that are sizable would be limited by our available financial
resources and ability to raise additional funds. If, as a result of such competition, we are unable to complete an initial business
combination, our public stockholders may receive only $10.00 per share, or possibly less than $10.00 per share, on the liquidation
of our trust account and our warrants will expire worthless.
The
ability of our public stockholders to redeem their shares for cash may make our financial condition unattractive to potential
target businesses, which may make it difficult for us to enter into a business combination.
We
may seek to enter into a definitive agreement with a prospective target business that requires as a closing condition that we
have a minimum amount of cash. If too many public stockholders exercise their redemption rights, we may not be able to meet such
closing condition and, as a result, would not be able to proceed with the business combination. Furthermore, in no event will
we redeem our public shares unless our net tangible assets are at least $5,000,001 either immediately prior to or upon consummation
of such business combination (so that we are not subject to the SEC’s “penny stock” rules). Consequently, if
accepting all properly submitted redemption requests would cause our net tangible assets to be less than $5,000,001 or will result
in us not being able to satisfy a closing condition as described above, we would not proceed with such redemption and the related
business combination and may instead search for an alternate business combination. Prospective targets will be aware of these
risks and, thus, may be reluctant to enter into a definitive agreement with us.
The
ability of our public stockholders to exercise redemption rights with respect to a large number of our shares may not allow us
to complete the most desirable business combination or optimize our capital structure.
At
the time we enter into an agreement for our initial business combination, we will not know how many stockholders may exercise
their redemption rights and, therefore, will need to structure the transaction based on our expectations as to the number of shares
that will be submitted for redemption. If our initial business combination agreement requires us to use a portion of the cash
in the trust account to pay the purchase price or requires us to have a minimum amount of cash at closing, we will need to reserve
a portion of the cash in the trust account to meet such requirements or arrange for third-party financing. In addition, if a larger
number of shares 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. The above considerations
may limit our ability to complete the most desirable business combination available to us or optimize our capital structure.
The
ability of our public stockholders to exercise redemption rights with respect to a large number of our shares could increase the
probability that our initial business combination would be unsuccessful and that you would have to wait for liquidation in order
to have your stock redeemed.
If
our 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 not be consummated
is increased. If our initial business combination is not consummated, 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 stock
in the open market; however, at such time our stock 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
our redemption until we liquidate or you are able to sell your stock 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 as we approach our dissolution deadline, which could undermine our ability
to complete our business combination on terms that would produce value for our stockholders.
Any
potential target business with which we enter into negotiations concerning a business combination will be aware that we must complete
our initial business combination within 24 months from the closing of our IPO. 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 second anniversary of the closing of our IPO.
If
we seek stockholder approval of our initial business combination, our initial stockholders, directors, officers, advisors and
their affiliates may elect to purchase shares from public stockholders, which may influence a vote on a proposed business combination
and reduce the public “float” of our common stock.
If
we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial
business combination pursuant to the tender offer rules, our initial stockholders, sponsor, directors, officers, advisors or any
of their affiliates may purchase public shares 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. Such a purchase may include
a contractual acknowledgement that such public stockholder, although still the record holder of our shares is no longer the beneficial
owner thereof and therefore agrees not to exercise its redemption rights. In the event that our initial stockholders, sponsor,
directors, officers, advisors or any of their affiliates purchase public shares in privately negotiated transactions from public
stockholders who have already elected to exercise their redemption rights, such selling public stockholders would be required
to revoke their prior elections to redeem their shares. The purpose of such purchases would be to vote such shares in favor of
the business combination and thereby increase the likelihood of obtaining stockholder approval of our initial business combination
or to satisfy a closing condition in an agreement with a target that requires us to have a minimum amount of cash at the closing
of our initial business combination, where it appears that such requirements would otherwise not be met. This 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.
In
addition, if such purchases are made, the public “float” of our common stock and the number of beneficial holders
of our securities may be reduced, possibly making it difficult to maintain or obtain the quotation, listing or trading of our
securities on a national securities exchange.
If
a stockholder fails to receive notice of our offer to redeem our public shares in connection with our business combination, or
fails to comply with the procedures for tendering its shares, such shares may not be redeemed.
We
will comply with the tender offer rules or proxy rules, as applicable, when conducting redemptions in connection with our business
combination. Despite our compliance with these rules, if a stockholder fails to receive our tender offer or proxy materials, as
applicable, such stockholder may not become aware of the opportunity to redeem its shares. In addition, the tender offer documents
or proxy materials, as applicable, that we will furnish to holders of our public shares in connection with our initial business
combination will describe the various procedures that must be complied with in order to validly tender or redeem public shares.
For example, in connection with any stockholder vote to approve a business combination, we may require our public stockholders
seeking to exercise their redemption rights, whether they are record holders or hold their shares in “street name,”
to either tender their certificates to our transfer agent up to two business days prior to the vote on the proposal to approve
the business combination or to deliver their shares to the transfer agent electronically. In the event that a stockholder fails
to comply with these or any other procedures, its shares may not be redeemed.
You
will not have any rights or interests in funds from the trust account, except under certain limited circumstances. To liquidate
your investment, therefore, you may be forced to sell your public shares or warrants, potentially at a loss.
Our
public stockholders will be entitled to receive funds from the trust account only upon the earliest to occur of: (i) our
completion of an initial business combination, and then only in connection with those shares of common stock that such stockholder
properly elected to redeem, subject to the limitations described herein; (ii) the redemption of any public shares properly
submitted in connection with a stockholder vote to amend our certificate of incorporation (A) to modify the substance or
timing of our obligation to allow redemption in connection with our initial business combination or certain amendments to our
certificate of incorporation or to redeem 100% of our public shares if we do not complete our initial business combination within
24 months from the closing of our IPO or (B) with respect to any other provision relating to stockholders’ rights or
pre-initial business combination activity and (iii) the redemption of our public shares if we are unable to complete an initial
business combination within 24 months from the closing of our IPO as further described herein. In no other circumstances will
a public stockholder have any right or interest of any kind in the trust account. Holders of warrants will not have any right
to the proceeds held in the trust account with respect to the warrants. Accordingly, to liquidate your investment, you may be
forced to sell your public shares or warrants, potentially at a loss.
The
NYSE 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
securities have been approved for listing on the NYSE. Although we expect to meet the minimum initial listing standards set forth
in the NYSE listing standards, we cannot assure you that our securities will continue to be listed on the NYSE in the future.
In order to continue listing our securities on the NYSE prior to our initial business combination, we must maintain certain financial,
distribution and stock price levels. Generally, we must maintain a minimum number of holders of our securities (generally 300
public stockholders). Additionally, in connection with our initial business combination, we will be required to demonstrate compliance
with the NYSE’s initial listing requirements, which are more rigorous than the NYSE’s continued listing requirements,
in order to continue to maintain the listing of our securities on the NYSE. For instance, our stock price would generally be required
to be at least $4.00 per share, our global market capitalization would be required to be at least $150,000,000, the aggregate
market value of publicly-held shares would be required to be at least $40,000,000 and we would be required to have at least 400
round lot holders. We cannot assure you that we will be able to meet those initial listing requirements at that time.
If
the NYSE delists our securities from trading on its exchange and we are not able to list our securities on another national securities
exchange, we expect our securities could be quoted on an over-the-counter market. If this were to occur, we could face significant
material adverse consequences, including:
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a
limited availability of market quotations for our securities;
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reduced
liquidity for our securities;
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a
determination that our common stock is a “penny stock” which will require
brokers trading in our common stock to adhere to more stringent rules and possibly result
in a reduced level of trading activity in the secondary trading market for our securities;
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a
limited amount of news and analyst coverage; and
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a
decreased ability to issue additional securities or obtain additional financing in the
future.
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The
National Securities Markets Improvement Act of 1996, which is a federal statute, prevents or preempts the states from regulating
the sale of certain securities, which are referred to as “covered securities.” Because our units and eventually our
common stock and warrants will be listed on the NYSE, our units, common stock and warrants will be covered securities. If we were
no longer listed on the NYSE, our securities would not be covered securities and we would be subject to regulation in each state
in which we offer our securities.
If
funds held outside the trust account are insufficient to allow us to operate prior to the completion of our initial business combination,
we may be unable to complete our initial business combination, in which case our public stockholders may only receive $10.00 per
share, or less than such amount in certain circumstances, and our warrants will expire worthless.
Of
the net proceeds of our IPO, only approximately $1,000,000 was available to us outside the trust account to fund our working capital
requirements. If funds available to us outside of the trust account are not sufficient to allow us to operate prior to the consummation
of an initial business combination, we would need to borrow funds from our sponsor 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, and any such advances would be repayable only from funds held outside the trust account or from funds released
to us upon completion of our initial business combination. If we are unable to complete our initial business combination because
we do not have sufficient funds available to us, we will be forced to cease operations and liquidate the trust account. Consequently,
our public stockholders may only receive $10.00 per share, or possibly less than $10.00 per share, 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
our stock price, which could cause you to lose some or all of your investment.
Even
if we conduct extensive due diligence on a target business with which we combine, we cannot assure you that this diligence will
surface all material issues that may be present inside a particular target business, that it would be possible to uncover all
material issues through a customary amount of due diligence, or that factors outside of the target business and outside of our
control will not later arise. As a result of these factors, we may be forced to later write-down or write-off assets, restructure
our operations, or incur impairment or other charges that could result in our reporting losses. Even if our due diligence successfully
identifies certain risks, unexpected risks may arise and previously known risks may materialize in a manner not consistent with
our preliminary risk analysis. Even though these charges may be non-cash items and not have an immediate impact on our liquidity,
the fact that we report charges of this nature could contribute to negative market perceptions about us or our securities. In
addition, charges of this nature may cause us to violate net worth or other covenants to which we may be subject as a result of
assuming pre-existing debt held by a target business or by virtue of our obtaining post-combination debt financing. Accordingly,
any stockholders who remain stockholders following the business combination could suffer a reduction in the value of their shares.
If
third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount
received by stockholders may be less than $10.00 per share.
Our
placing of funds in the trust account may not protect those funds from third-party claims against us. Although we will seek to
have all vendors, service providers (other than our independent auditors), 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 any monies held
in the trust account for the benefit of our public stockholders, such parties may not execute such agreements, or even if they
execute such agreements they may not be prevented from bringing claims against the trust account, including, but not limited to,
fraudulent inducement, breach of fiduciary responsibility or other similar claims, as well as claims challenging the enforceability
of the waiver, in each case in order to gain advantage with respect to a claim against our assets, including the funds held in
the trust account. If any third party refuses to execute an agreement waiving such claims to the monies held in the trust account,
our management will perform an analysis of the alternatives available to it and will only enter into an agreement with a third
party that has not executed a waiver if management believes that such third party’s engagement would be significantly more
beneficial to us than any alternative.
If
we are unable to complete our business combination within the prescribed timeframe, we will be required to provide for payment
of claims of creditors that were not waived that may be brought against us within the 10 years following redemption. Accordingly,
the per-share redemption amount received by public stockholders could be less than the $10.00 per share initially held in the
trust account, due to claims of such creditors. Our sponsor has agreed that it will be liable to us if and to the extent any claims
by a vendor for services rendered or products sold to us, or a prospective target business with which we have discussed entering
into a definitive agreement for a business combination, reduce the amount of funds in the trust account to below $10.00 per public
share, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account
(even if such waiver is deemed to be unenforceable) and except as to any claims under our indemnity of the underwriters of our
IPO against certain liabilities, including liabilities under the Securities Act. We have not independently verified whether our
sponsor has sufficient funds to satisfy its indemnity obligation and its only assets are expected to be our securities. As a result,
we think it is unlikely that our sponsor would be able to satisfy any indemnification obligation if it arises. In such event,
you may receive less than $10.00 per share in connection with any redemption of your public shares. None of our directors or officers
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 obligation of our sponsor resulting in a reduction in the amount of funds
in the trust account available for distribution to our public stockholders.
In
the event that the proceeds in the trust account are reduced below $10.00 per public share, and our sponsor asserts that it is
unable to satisfy its obligation or that it has no indemnification obligation related to a particular claim, our independent directors
would determine whether to take legal action against our sponsor to enforce its indemnification obligation. While we currently
expect that our independent directors would take legal action on our behalf against our sponsor to enforce its indemnification
obligation to us, it is possible that our independent directors in exercising their business judgment may choose not to do so
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
this indemnification obligation, the amount of funds in the trust account available for distribution to our public stockholders
may be reduced below $10.00 per share.
If,
after we distribute the proceeds in the trust account to our public stockholders, we file a bankruptcy petition or an involuntary
bankruptcy petition is filed against us that is not dismissed, a bankruptcy court may seek to recover such proceeds, and we and
our board may be exposed to claims of punitive damages.
If,
after we distribute the proceeds in the trust account to our public stockholders, we file a bankruptcy petition or an involuntary
bankruptcy petition is filed against us that is not dismissed, any distributions received by stockholders could be viewed under
applicable debtor/creditor and/or bankruptcy laws as either a “preferential transfer” or a “fraudulent conveyance.”
As a result, a bankruptcy court could seek to recover all amounts received by our stockholders. In addition, our board of directors
may be viewed as having breached its fiduciary duty to our creditors and/or having acted in bad faith, thereby exposing itself
and us to claims of punitive damages, by paying public stockholders from the trust account prior to addressing the claims of creditors.
If,
before distributing the proceeds in the trust account to our public stockholders, we file a bankruptcy petition or an involuntary
bankruptcy petition is filed against us that is not dismissed, the claims of creditors in such proceeding may have priority over
the claims of our stockholders and the per-share amount that would otherwise be received by our stockholders in connection with
our liquidation may be reduced.
If,
before distributing the proceeds in the trust account to our public stockholders, we file a bankruptcy petition or an involuntary
bankruptcy petition is filed against us that is not dismissed, the proceeds held in the trust account could be subject to applicable
bankruptcy law, and may be included in our bankruptcy estate and subject to the claims of third parties with priority over the
claims of our stockholders. To the extent any bankruptcy claims are paid from amounts in the trust account, the per-share amount
that would otherwise be received by our stockholders in connection with our liquidation would be reduced.
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 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 business combination. In addition, we may have imposed upon us burdensome requirements, including registration as
an investment company, adoption of a specific form of corporate structure, and reporting, record keeping, voting, proxy and disclosure
requirements and other rules and regulations.
In
order not to be regulated as an investment company under the Investment Company Act, unless we can qualify for an exclusion, we
must ensure that we are engaged primarily in a business other than investing, reinvesting or trading in securities and that our
activities do not include investing, reinvesting, owning, holding or trading “investment securities” constituting
more than 40% of our total assets (exclusive of U.S. government securities and cash items) on an unconsolidated basis. Our business
will be to identify and complete a business combination and thereafter to operate the post-transaction business or assets for
the long term. We do not plan to buy businesses or assets with a view to resale or profit from their resale. We do not plan to
buy unrelated businesses or assets or to be a passive investor. As a result of the foregoing, we do not believe that our anticipated
principal activities will subject us to the Investment Company Act. Furthermore, 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. 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.
Changes
in laws or regulations, or a failure to comply with any laws and regulations, may adversely affect our business, investments and
results of operations.
We
are subject to laws and regulations enacted by national, regional and local governments. In particular, we will be required to
comply with certain SEC and other legal requirements. Compliance with, and monitoring of, applicable laws and regulations may
be difficult, time consuming and costly. Those laws and regulations and their interpretation and application may also change from
time to time and those changes could have a material adverse effect on our business, investments and results of operations. In
addition, a failure to comply with applicable laws or regulations, as interpreted and applied, could have a material adverse effect
on our business and results of operations.
Our
stockholders may be held liable for claims by third parties against us to the extent of distributions received by them upon redemption
of their shares.
Under
the DGCL, stockholders may be held liable for claims by third parties against a corporation to the extent of distributions received
by them in a dissolution. The pro rata portion of our trust account distributed to our public stockholders upon the redemption
of our public shares in the event we do not complete our initial business combination within 24 months from the closing of our
IPO may be considered a liquidating distribution under Delaware law. If a corporation complies with certain procedures set forth
in Section 280 of the DGCL intended to ensure that it makes reasonable provision for all claims against it, including a 60-day
notice period during which any third-party claims can be brought against the corporation, a 90-day period during which the corporation
may reject any claims brought, and an additional 150-day waiting period before any liquidating distributions are made to stockholders,
any liability of stockholders with respect to a liquidating distribution is limited to the lesser of such stockholder’s
pro rata share of the claim or the amount distributed to the stockholder, and any liability of the stockholder would be barred
after the third anniversary of the dissolution. However, it is our intention to redeem our public shares as soon as reasonably
possible following the 24th month from the closing of our IPO in the event we do not complete our business combination
and, therefore, we do not intend to comply with the foregoing procedures.
Because
we will not be complying with Section 280, Section 281(b) of the DGCL requires us to adopt a plan, based on facts known
to us at such time that will provide for our payment of all existing and pending claims or claims that may be potentially brought
against us within the 10 years following our dissolution. However, because we are a blank check company, rather than an operating
company, and our operations will be limited to searching for prospective target businesses to acquire, the only likely claims
to arise would be from our vendors (such as lawyers, investment bankers, etc.) or prospective target businesses. If our plan of
distribution complies with Section 281(b) of the DGCL, any liability of stockholders with respect to a liquidating distribution
is limited to the lesser of such stockholder’s pro rata share of the claim or the amount distributed to the stockholder,
and any liability of the stockholder would likely be barred after the third anniversary of the dissolution. We cannot assure you
that we will properly assess all claims that may be potentially brought against us. As such, our stockholders could potentially
be liable for any claims to the extent of distributions received by them (but no more) and any liability of our stockholders may
extend beyond the third anniversary of such date. Furthermore, if the pro rata portion of our trust account distributed to our
public stockholders upon the redemption of our public shares in the event we do not complete our initial business combination
within 24 months from the closing of our IPO is not considered a liquidating distribution under Delaware law and such redemption
distribution is deemed to be unlawful, then pursuant to Section 174 of the DGCL, the statute of limitations for claims of
creditors could then be six years after the unlawful redemption distribution, instead of three years, as in the case of a liquidating
distribution.
We
may not hold an annual meeting of stockholders until after the consummation of our initial business combination, which could delay
the opportunity for our stockholders to elect directors.
In
accordance with the NYSE corporate governance requirements, we are not required to hold an annual meeting until one year after
our first full fiscal year end following our listing on the NYSE. Under Section 211(b) of the DGCL, we are, however, required
to hold an annual meeting of stockholders for the purposes of electing directors in accordance with our bylaws unless such election
is made by written consent in lieu of such a meeting. We may not hold an annual meeting of stockholders to elect new directors
prior to the consummation of our initial business combination, and thus we may not be in compliance with Section 211(b) of
the DGCL. Therefore, if our stockholders want us to hold an annual meeting prior to the consummation of our initial business combination,
they would have to force us to hold one by submitting an application to the Delaware Court of Chancery in accordance with Section 211(c)
of the DGCL.
We
have not registered the shares of common stock issuable upon exercise of the warrants under the Securities Act or any state securities
laws at this time, and such registration may not be in place when an investor desires to exercise warrants, thus precluding such
investor from being able to exercise its warrants except on a cashless basis and potentially causing such warrants to expire worthless.
We
have not registered the shares of common stock 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, as soon as practicable, but in no event
later than 15 business days after the closing of our initial business combination, to use our best efforts to file a registration
statement under the Securities Act covering such shares, and have it declared effective and maintain a current prospectus relating
to the common stock issuable upon exercise of the warrants, until the expiration of the warrants in accordance with the provisions
of the warrant agreement. We cannot assure you that we will be able to do so if, for example, any facts or events arise 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 shares issuable upon exercise of the warrants are not registered under the Securities Act, we will be required to permit holders
to exercise their warrants on a cashless basis. However, no warrant will be exercisable for cash or on a cashless basis, and we
will not be obligated to issue any shares to holders seeking to exercise their warrants, unless the issuance of the shares upon
such exercise is registered or qualified under the securities laws of the state of the exercising holder, or an exemption from
registration is available.
Notwithstanding
the above, if our common stock is at the time of any exercise of a warrant not listed on a national securities exchange such that
it satisfies the definition of a “covered security” under Section 18(b)(1) of the Securities Act, we may, at
our option, require holders of public warrants who exercise their warrants to do so on a “cashless basis” in accordance
with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in
effect a registration statement, but we will be required to use our best efforts to register or qualify the shares under applicable
blue sky laws to the extent an exemption is not available.
In
no event will we be required to net cash settle any warrant, or issue securities or other compensation in exchange for the warrants
in the event that we are unable to register or qualify the shares underlying the warrants under applicable state securities laws
and there is no exemption available. If the issuance of the shares upon exercise of the warrants is not so registered or qualified
or exempt from registration or qualification, the holder of such warrant shall not be entitled to exercise such warrant and, if
the holder does not sell the warrant, such warrant may have no value and expire worthless. In such event, holders who acquired
their warrants as part of a purchase of units will have paid the full unit purchase price solely for the shares of common stock
included in the units. 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 shares of common stock for sale under all applicable state securities laws.
The
grant of registration rights may make it more difficult to negotiate the terms of our initial business combination, and the future
exercise of such rights may adversely affect the market price of our common stock.
Pursuant
to an agreement entered into concurrently with the issuance and sale of the securities in our IPO, our sponsor and its transferees
can demand that we register their founder shares, private placement warrants and the shares of common stock issuable upon exercise
of the private placement warrants held by them, as well as any warrants and underlying shares of common stock that may be issued
upon conversion of working capital loans. We will bear the cost of registering these securities. The registration and availability
of such a significant number of securities for trading in the public market may have an adverse effect on the market price of
our common stock. In addition, the existence of the registration rights may make negotiating the terms of our initial business
combination more difficult. This is because the stockholders of the target business may increase the equity stake they seek in
the combined entity or ask for more cash consideration to offset the negative impact on the market price of our common stock that
may occur when the securities owned by our initial stockholders, holders of the private placement warrants or their respective
permitted transferees are registered.
In
the event that the Proposed Lion Transaction were to be terminated, you would be unable to ascertain the merits or risks of any
alternative target business prior to our entry into an alternative business combination agreement.
In
the event that the Proposed Lion Transaction were to be terminated, we would expect to focus our search on an alternative target
business involved in the ownership, financing and management of societal infrastructure, but we may seek to complete a business
combination with a target business in any industry or sector. Unless and until we have identified and publicly announced a business
combination transaction, there is no basis to evaluate the possible merits or risks of any particular target business or of the
terms of any combination with any such target business, and we cannot assure you that any such transaction would be more or less
favorable than the Proposed Lion Transaction, or would or would not result in a reduction in the value of our public shares.
We
may seek acquisition opportunities in industries or sectors outside of our management’s area of expertise.
We
may consider a business combination outside of our management’s area of expertise if a target business is presented to us
and we determine that such target offers an attractive acquisition opportunity for our company. In the event we elect to pursue
an acquisition outside of the areas of our management’s expertise, our management’s expertise may not be directly
applicable to its evaluation or operation, and the information contained in this 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 adequately ascertain or assess all of the significant risk factors. Accordingly, any stockholders who choose to
remain stockholders following our business combination could suffer a reduction in the value of their shares.
Although
we have identified general criteria and guidelines that we believe are important in evaluating prospective target businesses,
we may enter into our initial business combination with a target that does not meet such criteria and guidelines, and as a result,
the target business with which we enter into our initial business combination may not have attributes entirely consistent with
our general criteria and guidelines.
Although
we have identified general criteria and guidelines for evaluating prospective target businesses, we may enter into a business
combination with a target that does 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 stockholders may exercise their redemption
rights, which may make it difficult for us to meet any closing condition with a target business that requires us to have a minimum
amount of cash. In addition, if stockholder approval of the transaction is required by law, or we decide to obtain stockholder
approval for business or other legal reasons, it may be more difficult for us to attain stockholder approval of our initial business
combination if the target business does not meet our general criteria and guidelines.
We
may seek acquisition opportunities with a financially unstable business or an entity lacking an established record of revenue
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 volatile revenues or earnings and difficulties in obtaining and retaining key personnel. Some of
these risks may be outside of our control and leave us with no ability to control or reduce the chances that those risks will
adversely impact a target business.
We
are not required to obtain an opinion from an independent investment banking firm or from another independent firm that commonly
renders valuation opinions, and consequently, you may have no assurance from an independent source that the price we are paying
for the business is fair to our company from a financial point of view.
Unless
we complete our business combination with an affiliated entity, we are not required to obtain an opinion from an independent investment
banking firm or from another independent entity that commonly renders valuation opinions that our initial business combination
is fair to our company from a financial point of view. If no opinion is obtained, our stockholders will be relying on the judgment
of our board of directors, who will determine fair market value based on standards generally accepted by the financial community.
Such standards used will be disclosed in our proxy solicitation or tender offer materials, as applicable, related to our initial
business combination.
We
may issue additional shares of common stock or preferred stock to complete our initial business combination or thereafter. Any
such issuances would dilute the interest of our stockholders and likely present other risks.
Our
certificate of incorporation authorizes the issuance of up to 50,000,000 shares of common stock, par value $0.0001 per share,
and 1,000,000 shares of undesignated preferred stock, par value $0.0001 per share. As of February 28, 2021, there were 10,068,320
authorized but unissued shares of common stock available for issuance, and 1,000,000 authorized but unissued shares of preferred
stock available for issuance. We may issue additional shares of common stock and shares of preferred stock to complete our initial
business combination, or for any purpose at any time thereafter, including under an employee incentive plan. The issuance of additional
shares of common or preferred stock:
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may
significantly dilute the equity interest of investors in our IPO;
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may
subordinate the rights of holders of common stock if preferred stock is issued with rights
senior to those afforded our common stock;
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could
cause a change of control if a substantial number of shares of common stock are issued,
which may affect, among other things, our ability to use our net operating loss carry
forwards, if any, and could result in the resignation or removal of our present officers
and directors; and
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may
adversely affect prevailing market prices for our units, common stock and/or warrants.
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Resources
could be wasted in researching acquisitions that are not completed, which could materially adversely affect subsequent attempts
to locate and acquire or merge with another business.
We
anticipate that the investigation of each specific target business and the negotiation, drafting and execution of relevant agreements,
disclosure documents and other instruments will require substantial management time and attention and substantial costs for accountants,
attorneys and others. If we decide not to complete a specific initial business combination, the costs incurred up to that point
for the proposed transaction likely would not be recoverable. Furthermore, if we reach an agreement relating to a specific target
business, we may fail to complete our initial business combination for any number of reasons including those beyond our control.
Any such event will result in a loss to us of the related costs incurred which could materially adversely affect subsequent attempts
to locate and acquire or merge with another business.
Our
key personnel may negotiate employment or consulting agreements with a target business in connection with a particular business
combination. These agreements may provide for them to receive compensation following our 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.
Any
of our key personnel may 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 or the target busines after
the completion of the business combination. The personal and financial interests of such individuals may influence their motivation
in identifying and selecting a target business. However, whether or not any such individuals remain with the post-transaction
company after the completion of our business combination will be a factor in our decision as to whether or not we will proceed
with any potential business combination only to the extent that we believe that it would materially benefit our stockholders following
the business combination.
We
may have a limited ability to assess the skills, qualifications or abilities of management of a prospective target business, which
could negatively impact the value of our stockholders’ investment in the post-transaction company.
When
evaluating the desirability of affecting 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’s management, therefore, may prove to be incorrect and such management may lack the skills, qualifications
or abilities we suspected. Should the target’s management not possess the skills, qualifications or abilities necessary
to manage a public company, the operations and profitability of the post-combination business may be negatively impacted. Accordingly,
any stockholders who remain stockholders following the business combination could suffer a reduction in the value of their shares.
Our
officers and directors are engaged in other business activities, which may limit their availability to us, which 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 several 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. The conflicts of interest could have a negative
impact on our ability to complete our initial business combination.
Our
officers and directors are affiliated with one or more entities engaged in business activities similar to those conducted by us,
and to which they owe contractual and fiduciary duties, and as a result may have conflicts of interest in determining to which
entity a particular business opportunity should be presented.
Our
directors and officers presently have, and any of them in the future may have, 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.
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 then has fiduciary or contractual obligations, he or she will honor his fiduciary or contractual obligations to present
such opportunity to such entity.
Pursuant
to the terms of our Business Combination Agreement with Lion Electric, our officers and directors and other representatives are
prohibited from soliciting, evaluating, or negotiating alternative business combinations involving us or on our behalf. However,
if our Business Combination Agreement with Lion Electric were to be terminated, our officers and directors may have conflicts
of interest in determining whether to present possible business combination opportunities to us or to any other such entity. These
conflicts may not be resolved in our favor and a potential target business may be presented to another entity prior to its presentation
to us. Our certificate of incorporation provides that we renounce our interest in any corporate opportunity offered to any director
or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer
of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable
for us to pursue.
Without
limiting the foregoing, all of our officers and directors have fiduciary and contractual duties to Northern Genesis Holdings Inc.
and/or to certain companies in which it has invested or may invest, by reason of his or her position with such company. These
entities currently include Northern Genesis II and Northern Genesis III, each of which may compete with us for acquisition opportunities,
and each of which is currently focused, like us, on target businesses making a positive contribution to sustainability through
the ownership, financing and management of societal infrastructure.
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 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 addition, we do not have a policy that 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 conflicts between their interests
and ours.
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, initial stockholders, officers, directors or their affiliates which may raise potential conflicts of interest.
If
our Business Combination Agreement with Lion Electric were to be terminated, we may decide to acquire one or more businesses affiliated
with our sponsor, any of our officers or directors, or affiliates of any of the foregoing. 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 a transaction was attractive and in the best interests of our stockholders. Despite our agreement to obtain an opinion from
an independent investment banking firm or from another independent entity that commonly renders valuation opinions regarding the
fairness of such a transaction, potential conflicts of interest still may exist and, as a result, the terms of the business combination
may not be as advantageous to our public stockholders as they would be absent any conflicts of interest.
Since
our initial stockholders, officers and directors will lose their entire investment in us if our business combination is not completed,
a conflict of interest may arise in determining whether a particular business combination target is appropriate for our initial
business combination.
Our
sponsor holds, and our officers and directors have an indirect financial interest in, our 7,986,336 founder shares and 8,139,069
private placement warrants, each exercisable for one share of common stock at $11.50 per share, all of which will be worthless
if we do not complete a business combination. In addition, we may obtain loans from our initial stockholders, officers, directors
or their affiliates which likely would not be repaid if we do not consummate an 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.
We
may issue notes or other debt securities, or otherwise incur substantial debt, to complete a business combination, which may adversely
affect our leverage and financial condition and thus negatively impact the value of our stockholders’ investment in us.
We
may choose to incur substantial debt to complete our business combination, provided that such debt is non-recourse to funds held
in the trust account and, as such, will not 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:
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default
and foreclosure on our assets if our operating revenues after an initial business combination
are insufficient to repay our debt obligations;
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acceleration
of our obligations to repay the indebtedness even if we make all principal and interest
payments when due if we breach certain covenants that require the maintenance of certain
financial ratios or reserves without a waiver or renegotiation of that covenant;
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our
immediate payment of all principal and accrued interest, if any, if the debt security
is payable on demand;
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our
inability to obtain necessary additional financing if the debt security contains covenants
restricting our ability to obtain such financing while the debt security is outstanding;
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our
inability to pay dividends on our common stock;
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using
a substantial portion of our cash flow to pay principal and interest on our debt, which
will reduce the funds available for dividends on our common stock if declared, our ability
to pay expenses, make capital expenditures and acquisitions, and fund other general corporate
purposes;
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limitations
on our flexibility in planning for and reacting to changes in our business and in the
industry in which we operate;
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increased
vulnerability to adverse changes in general economic, industry and competitive conditions
and adverse changes in government regulation;
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limitations
on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions,
debt service requirements, and execution of our strategy; and
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other
disadvantages compared to our competitors who have less debt.
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If
our business combination is with only one target business, we would be solely dependent on this single business which may have
a limited number of products or services. This lack of diversification may negatively impact our operations and profitability.
We
may effectuate our 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 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.
In addition, we intend to focus our search for an initial business combination in 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 developments, any or all of which may
have a substantial adverse impact upon the particular industry in which we may operate subsequent to our business combination.
If
we attempt to simultaneously complete business combinations with multiple prospective targets, it may hinder our ability to complete
our 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 may 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.
Our
management may not be able to maintain control of a target business after our initial business combination.
We
anticipate completing a business combination only if the post-transaction company owns or acquires 50% or more of the outstanding
voting securities of the target or otherwise holds a controlling interest in the target sufficient for us not to be required to
register as an investment company under the Investment Company Act. Even if the post-transaction company owns 50% or more of the
voting securities of the target, our stockholders prior to the business combination may collectively own a minority interest in
the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For
example, we could pursue a transaction in which we issue a substantial number of new shares of common stock in exchange for all
of the outstanding capital stock of a target. In this case, we would acquire a 100% interest in the target. However, as a result
of the issuance of a substantial number of new shares of common stock, our stockholders immediately prior to such transaction
could own less than a majority of our outstanding shares of common stock subsequent to such transaction. In addition, other minority
stockholders may subsequently combine their holdings resulting in a single person or group obtaining a larger share of the company’s
stock than we initially acquired. Accordingly, our management may not control the post-transaction company following our business
combination, and we cannot provide assurance that management of the post-transaction company will possess the skills, qualifications
or abilities necessary to profitably operate such 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 a business combination even though a substantial majority of our stockholders elect to have their shares redeemed.
Our
certificate of incorporation does not provide a specified maximum redemption threshold, except that in no event will we redeem
our public shares unless our net tangible assets are at least $5,000,001 either immediately prior to or upon consummation of an
initial business combination (such that we are not subject to the SEC’s “penny stock” rules). As a result, we
may be able to complete our initial business combination even though a substantial majority of our public stockholders do not
agree with the transaction and have redeemed their shares. In the event the aggregate cash consideration we would be required
to pay for all shares of common stock that are validly submitted for redemption plus any amount required to satisfy cash conditions
pursuant to the terms of the proposed business combination exceed the aggregate amount of cash available to us, we will not complete
the business combination or redeem any shares, all shares of common stock submitted for redemption will be returned to the holders
thereof, and we instead may search for an alternate business combination.
The
provisions of our certificate of incorporation that relate to our pre-business combination activity may be amended with the approval
of holders of 50% of our common stock.
Our
certificate of incorporation may be amended by holders of a majority of our outstanding common stock entitled to vote thereon,
subject to applicable provisions of the DGCL or applicable stock exchange rules. Our initial stockholders, who collectively beneficially
own 20% of our common stock, will participate in any vote to amend our certificate of incorporation and will have the discretion
to vote in any manner it chooses. Our ability to amend the provisions of our certificate of incorporation which govern our pre-business
combination activity may increase our ability to complete a business combination with which you do not agree.
Our
sponsor controls a substantial interest in us and thus may influence certain actions requiring a stockholder vote.
Our
sponsor owns 20% of our issued and outstanding shares of common stock. None of our sponsor, officers, directors, or
their affiliates has indicated any intention to purchase any units or shares of common stock from persons in the open market or
in private transactions. However, our sponsor, officers, directors, or their affiliates could determine in the future to make
such purchases in the open market or in private transactions, to the extent permitted by law, in order to influence the vote or
magnitude of the number of stockholders seeking to tender their shares to us. In connection with any vote for a proposed business
combination, our sponsor and our officers and directors have agreed to vote the shares of common stock owned by them in favor
of such proposed business combination.
Our
board of directors is divided into two classes, each of which will generally serve for a term of two years with only one class
of directors being elected in each year. It is unlikely that there will be an annual meeting of stockholders to elect new directors
prior to the consummation of a business combination, in which case all of the current directors will continue in office until
at least the consummation of the business combination. Accordingly, you may not be able to exercise your voting rights under corporate
law for up to 24 months. If there is an annual meeting, as a consequence of our “staggered” board of directors, only
a minority of the board of directors will be considered for election and our sponsor, because of its ownership of 20% of our outstanding
common stock, will have considerable influence regarding the outcome. Accordingly, our sponsor will continue to exert control
at least until the consummation of a business combination.
We
may amend the terms of the warrants in a manner that may be adverse to holders of warrants with the approval by the holders of
at least a majority of the then outstanding warrants.
Our
warrants have been issued in registered form under a warrant agreement between Continental Stock Transfer & Trust Company,
as warrant agent, and us. The warrant agreement provides that the terms of the warrants may be amended without the consent of
any holder to cure any ambiguity or correct any defective provision, but requires the approval by the holders of at least a majority
of the then outstanding warrants (including the private warrants) to make any change that adversely affects the interests of the
registered holders of public warrants. Accordingly, we may amend the terms of the warrants in a manner adverse to a holder if
holders of at least a majority of the then outstanding warrants approve of such amendment. Although our ability to amend the terms
of the warrants with the consent of at least a majority of the then outstanding warrants is unlimited, examples of such amendments
could be amendments to, among other things, increase the exercise price of the warrants, shorten the exercise period or decrease
the number of shares of our common stock purchasable upon exercise of a warrant.
We
may redeem your unexpired warrants prior to their exercise at a time that is disadvantageous to you.
We
have the ability to redeem outstanding warrants at any time after they become exercisable and prior to their expiration, at a
price of $0.01 per warrant, provided that the last reported sales price of our common stock equals or exceeds $18.00 per share
(as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like and for certain issuances of common
stock and equity-linked securities as described herein) for any 20 trading days within a 30 trading-day period commencing once
the warrants become exercisable and ending on the third trading day prior to the date on which we give proper notice of such redemption
and provided certain other conditions are met. If and when the warrants become redeemable by us, we may exercise our redemption
right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws.
Redemption
of the outstanding warrants could force you (i) to exercise your warrants and pay the exercise price therefor at a time when
it may be disadvantageous for you to do so, (ii) to sell your warrants at the then-current market price when you might otherwise
wish to hold your warrants or (iii) to accept the nominal redemption price which, at the time the outstanding warrants are
called for redemption, is likely to be substantially less than the market value of your warrants. None of the private placement
warrants are redeemable by us so long as they are held by the initial purchasers or their permitted transferees.
Our
warrants may have an adverse effect on the market price of our common stock and make it more difficult to effectuate our business
combination.
We
issued warrants to purchase 15,972,672 shares of common stock as part of the units sold in our IPO and, simultaneously with the
closing of our IPO, we issued in a private placement warrants to purchase an aggregate of 8,139,069 shares of common stock at
$11.50 per share. In addition, if our sponsor or any of our officers, directors or their affiliates makes any working capital
loans, up to $3,000,000 of such loans may be converted into warrants, at the price of $1.00 per warrant at the option of the lender.
Such warrants would be identical to the private placement warrants, including as to exercise price, exercisability and exercise
period.
The
potential for the issuance of a substantial number of additional shares of common stock upon exercise of these warrants could
make us a less attractive acquisition vehicle to a target business. Any such issuance will increase the number of issued and outstanding
shares of our common stock and reduce the value of the shares of common stock issued to complete the business combination. Therefore,
our warrants may make it more difficult to effectuate a business combination or increase the cost of acquiring the target business.
A
market for our securities may not be sustained, which would adversely affect the liquidity and price of our securities.
An
active trading market for our securities may not be sustained. You may be unable to sell your securities unless a market can be
established and sustained.
Because
we must furnish our stockholders with target business financial statements, we may lose the ability to complete an otherwise advantageous
initial business combination with some prospective target businesses.
The
federal proxy rules require that a proxy statement with respect to a vote on a business combination meeting certain financial
significance tests include historical and/or pro forma financial statement disclosure in periodic reports. 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 financing reporting standards, or
IFRS, depending on the circumstances and the historical financial statements may be required to be audited in accordance with
the standards of the Public Company Accounting Oversight Board (United States), or PCAOB. 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.
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 attestation requirements
of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic
reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation
and stockholder approval of any golden parachute payments not previously approved. As a result, our stockholders may not have
access to certain information they may deem important. We could be an emerging growth company for up to five years, although circumstances
could cause us to lose that status earlier, including if the market value of our common stock held by non-affiliates 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 accountant 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 the fiscal year in which (1) the market
value of our common stock held by non-affiliates exceeds $250 million as of the prior June 30th, or (2) our
annual revenues exceeded $100 million during such completed fiscal year and the market value of our common stock held by non-affiliates
exceeds $700 million as of the prior June 30th. To the extent we take advantage of such reduced disclosure obligations,
it may also make comparison of our financial statements with other public companies difficult or impossible.
We have identified material weaknesses
in our internal control over financial reporting. We may identify additional material weaknesses in the future or otherwise fail
to maintain an effective system of internal controls, which may result in material misstatements of our financial statements or
cause us to fail to meet our reporting obligations.
In connection with
a review of our financial statements for the year ended December 31, 2020, we identified a material weakness in our internal control
over the reporting of the Personnel Services Agreement (as defined in this report). A material weakness is defined
as a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable
possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely
basis.
Effective internal
controls are necessary for us to provide reliable financial reports and prevent fraud. As of December 31, 2020, we identified material
weaknesses in our internal control over financial reporting. While we do not believe the material weakness resulted in any
misstatement of our financial statements, we intend to implement additional communication and documentation procedures, among other
steps, as part of our internal controls to remediate the material weakness. These remediation measures may be time consuming
and costly. In addition, there is no assurance that we will be successful in remediating the material weakness.
Any newly identified material weakness could
limit our ability to prevent or detect a misstatement of our accounts or disclosures that could result in a material misstatement
of our annual or interim financial statements. In such case, we may be unable to maintain compliance with securities law requirements
regarding timely filing of periodic reports in addition to applicable stock exchange listing requirements, we may be unable to
prevent fraud, investors may lose confidence in our financial reporting, and our stock price may decline as a result. We cannot
assure you that the measures we have taken to date, or any measures we may take in the future, will be sufficient to avoid potential
future material weaknesses.
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 acquisition.
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, 2021. 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 company
with which we seek to complete our 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 acquisition. Further, we may be subject
to additional burdensome and costly requirements under the Sarbanes-Oxley Act if we are no longer an emerging growth company or
smaller reporting company.
Provisions
in our certificate of incorporation and Delaware law may inhibit a takeover of us, which could limit the price investors might
be willing to pay in the future for our common stock and could entrench management.
Our
certificate of incorporation contains provisions that may discourage unsolicited takeover proposals that stockholders may consider
to be in their best interests. These provisions include a staggered board of directors and the ability of the board of directors
to designate the terms of and issue new series of preferred shares. We are also subject to anti-takeover provisions under Delaware
law, which could delay or prevent a change of control. Together these provisions may make the removal of management more difficult
and may discourage transactions that otherwise could involve payment of a premium over prevailing market prices for our securities.
If
we effect our initial business combination with a company with operations or opportunities outside of the United States,
we would be subject to a variety of additional risks that may negatively impact our operations.
If
we effect our initial business combination with a company with operations or opportunities outside of the United States,
we would be subject to any special considerations or risks associated with companies operating in an international setting, including
any of the following:
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higher
costs and difficulties inherent in managing cross-border business operations and complying
with different commercial and legal requirements of overseas markets;
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rules
and regulations regarding currency redemption;
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complex
corporate withholding taxes on individuals;
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laws
governing the manner in which future business combinations may be effected;
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tariffs
and trade barriers;
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regulations
related to customs and import/export matters;
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longer
payment cycles and challenges in collecting accounts receivable;
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tax
issues, such as tax law changes and variations in tax laws as compared to the United States;
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currency
fluctuations and exchange controls;
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cultural
and language differences;
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employment
regulations;
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crime,
strikes, riots, civil disturbances, terrorist attacks, natural disasters and wars;
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deterioration
of political relations with the United States; and
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government
appropriations of assets.
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We
may not be able to adequately address these additional risks. If we were unable to do so, our operations might suffer, which may
adversely impact our results of operations and financial condition.
Our
certificate of incorporation requires, subject to limited exceptions, that derivative actions brought in our name, actions against
our directors, officers, other employees or stockholders for breach of fiduciary duty and other similar actions may be brought
only in the Court of Chancery in the State of Delaware and, if such actions are brought outside of the State of Delaware, the
stockholder bringing the suit will be deemed to have consented to service of process on such stockholder’s counsel, which
may have the effect of discouraging lawsuits against our directors, officers, other employees or stockholders.
Our
certificate of incorporation requires, to the fullest extent permitted by law, that derivative actions brought in our name, actions
against our directors, officers and employees for breach of fiduciary duty and certain other actions may be brought only in the
Court of Chancery in the State of Delaware, except any action (A) as to which the Court of Chancery in the State of Delaware
determines that there is an indispensable party not subject to the jurisdiction of the Court of Chancery (and the indispensable
party does not consent to the personal jurisdiction of the Court of Chancery within ten days following such determination), (B) which
is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery or (C) for which the Court of
Chancery does not have subject matter jurisdiction. Any person or entity purchasing or otherwise acquiring any interest in shares
of our capital stock shall be deemed to have notice of and consented to the forum provisions in our certificate of incorporation.
This
choice of forum provision may make it more costly, or limit a stockholder’s ability, to bring a claim in a judicial forum
that it finds favorable for disputes with us or any of our directors, officers or employees, which may discourage lawsuits with
respect to such claims. We cannot be certain that a court will decide that this provision is either applicable or enforceable,
and if a court were to find the choice of forum provision contained in our certificate of incorporation to be inapplicable or
unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which
could harm our business, operating results and financial condition.
Our
certificate of incorporation provides that the exclusive forum provision is applicable to the fullest extent permitted by applicable
law, subject to certain exceptions. Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits
brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder. As a result, the
exclusive forum provision will not apply to suits brought to enforce any duty or liability created by the Exchange Act or any
other claim for which the federal courts have exclusive jurisdiction. In addition, the exclusive forum provision will not apply
to actions brought under the Securities Act, or the rules and regulations thereunder.
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, or that of a third party with which we do business. 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, lawsuits, investigations, fines and penalties, whether directly or through claims made against us by third
parties.
Any
search for a business combination, and any target business with which we ultimately consummate a business combination, may be
materially adversely affected by the recent coronavirus (COVID-19) pandemic.
In
December 2019, a novel strain of coronavirus was reported to have surfaced in Wuhan, China, which has and is continuing to
spread throughout China and other parts of the world, including the United States. On January 30, 2020, the World Health
Organization declared the outbreak of the coronavirus disease (COVID-19) a “Public Health Emergency of International Concern.”
On January 31, 2020, the U.S. Health and Human Services Secretary declared a public health emergency for the United States
to aid the U.S. healthcare community in responding to COVID-19, and on March 11, 2020 the World Health Organization characterized
the outbreak as a “pandemic”. The COVID-19 outbreak has adversely affected, and other events (such as terrorist attacks,
natural disasters or a significant outbreak of other infectious diseases) could adversely affect, the economies and financial
markets worldwide, and the business of any potential target business with which we consummate a business combination could be
materially and adversely affected. Furthermore, we may be unable to complete a business combination if 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 events (such as terrorist attacks, natural disasters
or a significant outbreak of other infectious diseases) 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 (such as terrorist attacks, natural disasters or a significant outbreak of other infectious
diseases), including as a result of increased market volatility, decreased market liquidity in third-party financing being unavailable
on terms acceptable to us or at all.
The
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 stockholders may be less than $10.00
per share.
The
proceeds held in the Trust Account are invested only in U.S. government treasury obligations with a maturity of 180 days or less
or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act, which invest only in direct
U.S. government treasury obligations. While short-term U.S. government treasury obligations currently yield a positive rate of
interest, they have briefly yielded negative interest rates in recent years. Central banks in Europe and Japan pursued interest
rates below zero in recent years, and the Open Market Committee of the Federal Reserve has not ruled out the possibility that
it may in the future adopt similar policies in the United States. In the event that we are unable to complete our initial business
combination or make certain amendments to our certificate of incorporation, our public stockholders are entitled to receive their
pro-rata share of the proceeds held in the Trust Account, plus any interest income not released to us, net of taxes payable. Negative
interest rates could impact the per-share redemption amount that may be received by public stockholders.