Item 1A. Risk Factors.
An investment in our securities involves a
high degree of risk. You should consider carefully all of the risks described below, together with the other information contained in
this Form 10-K, before making a decision to invest in our units. If any of the following events occur, our business, financial condition
and operating results may be materially adversely affected. In that event, the trading price of our securities could decline, and you
could lose all or part of your investment.
Risk Factor Summary
| ● | We
are a blank check company with no operating history and no revenues, and you have no basis on which to evaluate our ability to achieve
our business objective. |
| ● | Our
shareholders may not be afforded an opportunity to vote on our proposed initial business combination, and even if we hold a vote, holders
of our founder shares will participate in such vote, which means we may complete our initial business combination even though a majority
of our public shareholders do not support such a combination. |
| ● | Your
only opportunity to effect your investment decision regarding a potential business combination may be limited to the exercise of your
right to redeem your shares from us for cash. |
| ● | If
we seek shareholder approval of our initial business combination, our initial shareholders and management team have agreed to vote in
favor of such initial business combination, regardless of how our public shareholders vote. |
| ● | In
evaluating a prospective target business for our initial business combination, our management will rely on the availability of all of
the funds from the sale of the forward purchase units to be used as part of the consideration to the sellers in the initial business
combination. If the sale of the forward purchase units does not close, we may lack sufficient funds to consummate our initial business
combination. |
| ● | The
ability of our public shareholders to redeem their shares for cash may make our financial condition unattractive to potential business
combination targets, which may make it difficult for us to enter into a business combination with a target. |
| ● | The
ability of our public shareholders to exercise redemption rights with respect to a large number of our shares may not allow us to complete
the most desirable business combination or optimize our capital structure. |
| ● | We have identified material weaknesses in our internal control over
financial reporting. These material weaknesses could continue to adversely affect our ability to report our results of operations and
financial condition accurately in a timely manner. |
| ● | Our
independent registered public accounting firm’s report contains an explanatory paragraph that expresses substantial doubt about
our ability to continue as a “going concern.” |
| ● | The
requirement that we complete our initial business combination by December 21, 2022 may give potential target businesses leverage over
us in negotiating a business combination and may limit the time we have in which to conduct due diligence on potential business combination
targets, in particular as we approach our dissolution deadline, which could undermine our ability to complete our initial business combination
on terms that would produce value for our shareholders. |
| ● | Our
search for a business combination, and any target business with which we ultimately consummate a business combination, may be materially
adversely affected by the coronavirus (COVID-19) outbreak and the status of debt and equity markets. |
| ● | We
may not be able to complete our initial business combination by December 21, 2022, in which case we would cease all operations except
for the purpose of winding up and we would redeem our public shares and liquidate. |
| ● | If
we seek shareholder approval of our initial business combination, our Sponsor, initial shareholders, directors, executive officers, advisors
and their affiliates may elect to purchase shares or public warrants from public shareholders, which may influence a vote on a proposed
business combination and reduce the public “float” of our Class A ordinary shares. |
| ● | If
a shareholder fails to receive notice of our offer to redeem our public shares in connection with our initial business combination, or
fails to comply with the procedures for submitting or tendering its shares, such shares may not be redeemed. |
| ● | Our
officers and directors will allocate their time to other businesses thereby causing conflicts of interest in their determination as to
how much time to devote to our affairs. This conflict of interest could have a negative impact on our ability to complete our initial
business combination. |
| ● | OrION
has committed to purchase at least $100,000,000 of forward purchase units and has the right to purchase up to $200,000,000 of additional
forward purchase units concurrently with the closing of our initial business combination, but has no obligation to purchase any or all
of such additional amount. Our ability to consummate our initial business combination may be adversely impacted if OrION declines to
exercise this right. |
| ● | You
will not have any rights or interests in funds from the trust account, except under certain limited circumstances. Therefore, to liquidate
your investment, you may be forced to sell your public shares or warrants, potentially at a loss. |
| ● | Nasdaq
may delist our securities from trading on its exchange, which could limit investors’ ability to make transactions in our securities
and subject us to additional trading restrictions. |
| ● | You
will not be entitled to protections normally afforded to investors of many other blank check companies. |
| ● | Because
of our limited resources and the significant competition for business combination opportunities, it may be more difficult for us to complete
our initial business combination. If we are unable to complete our initial business combination, our public shareholders may receive
only their pro rata portion of the funds in the trust account that are available for distribution to public shareholders, and our warrants
will expire worthless. |
| ● | If
the net proceeds of the initial public offering and the sale of the private placement warrants not being held in the trust account are
insufficient to allow us to operate for at least until December 21, 2022, it could limit the amount available to fund our search for
a target business or businesses and complete our initial business combination, and we will depend on loans from our Sponsor or management
team to fund our search and to complete our initial business combination. |
| ● | Past
performance by our management team and their affiliates, including investments and transactions in which they have participated and businesses
with which they have been associated, may not be indicative of future performance of an investment in us. |
| ● | Unlike
some other similarly structured special purpose acquisition companies, our initial shareholders will receive additional Class A ordinary
shares if we issue certain shares to consummate an initial business combination. |
| ● | We
may be a passive foreign investment company, or “PFIC,” which could result in adverse United States federal income tax consequences
to U.S. investors. |
| ● | We
may reincorporate in another jurisdiction in connection with our initial business combination and such reincorporation may result in
taxes imposed on shareholders. |
| ● | We
may reincorporate in another jurisdiction in connection with our initial business combination, and the laws of such jurisdiction may
govern some or all of our future material agreements and we may not be able to enforce our legal rights. |
Risks Relating to our Search for, Consummation
of, or Inability to Consummate, a Business Combination and Post-Business Combination Risks
Our public shareholders may not be afforded
an opportunity to vote on our proposed initial business combination, and even if we hold a vote, holders of our founder shares will participate
in such vote, which means we may complete our initial business combination even though a majority of our public shareholders do not support
such a combination.
We may choose not to hold a shareholder vote to
approve our initial business combination unless the business combination would require shareholder approval under applicable law or stock
exchange listing requirements. In such case, the decision as to whether we will seek shareholder approval of a proposed business combination
or will allow shareholders to sell their shares to us in a tender offer will be made by us, solely in our discretion, and will be based
on a variety of factors, such as the timing of the transaction and whether the terms of the transaction would otherwise require us to
seek shareholder approval. Even if we seek shareholder approval, the holders of our founder shares will participate in the vote on such
approval. Accordingly, we may complete our initial business combination even if holders of a majority of our ordinary shares do not approve
of the business combination we complete.
In evaluating a prospective target business
for our initial business combination, our management will rely on the availability of all the funds from the sale of the forward purchase
units to be used as part of the consideration to the sellers in the initial business combination. If the sale of the forward purchase
units fails to close, we may lack sufficient funds to consummate our initial business combination.
In connection with the consummation of the initial
public offering, we entered into a forward purchase agreement with OrION pursuant to which OrION has committed that it will purchase from
us 10,000,000 forward purchase units, or at its option up to an aggregate maximum of 30,000,000 forward purchase units, each consisting
of one Class A ordinary share, or a forward purchase share, and one-third of one warrant to purchase one Class A ordinary share for $10.00
per unit, or an aggregate amount of $100,000,000, or at OrION’s option up to an aggregate amount of $300,000,000, in a private placement
that will close concurrently with the closing of our initial business combination. The proceeds from the sale of these forward purchase
units, together with the amounts available to us from the trust account (after giving effect to any redemptions of public shares) and
any other equity or debt financing obtained by us in connection with the business combination, will be used to satisfy the cash requirements
of the business combination, including funding the purchase price and paying expenses and retaining specified amounts to be used by the
post-business combination company for working capital or other purposes. The forward purchase shares will be identical to the Class A
ordinary shares included in the units being sold in the initial public offering, except that they will be subject to transfer restrictions
and registration rights, as described herein. The forward purchase warrants will have the same terms as the private placement warrants
so long as they are held by or its permitted assignees and transferees.
Your only opportunity to effect your investment
decision regarding a potential business combination may be limited to the exercise of your right to redeem your shares from us for cash.
At the time of your investment in us, you will
not be provided with an opportunity to evaluate the specific merits or risks of our initial business combination. Since our board of directors
may complete a business combination without seeking shareholder approval, public shareholders may not have the right or opportunity to
vote on the business combination, unless we seek such shareholder vote. Accordingly, your only opportunity to effect your investment decision
regarding our initial business combination may be limited to exercising your redemption rights within the period of time (which will be
at least 20 business days) set forth in our tender offer documents mailed to our public shareholders in which we describe our initial
business combination.
Members of our management team and board of
directors have significant experience as board members, officers or executives of other companies. As a result, certain of those persons
have been, may be, or may become, involved in proceedings, investigations and litigation relating to the business affairs of the companies
with which they were, are, or may in the future be, affiliated. This may have an adverse effect on us, which may impede our ability to
consummate an initial business combination.
During the course of their careers, members of
our management team and board of directors have had significant experience as board members, officers or executives of other companies.
As a result of their involvement and positions in these companies, certain persons were, are now, or may in the future become, involved
in litigation, investigations or other proceedings relating to the business affairs of such companies or transactions entered into by
such companies. Any such litigation, investigations or other proceedings may divert our management team’s and board’s attention
and resources away from identifying and selecting a target business or businesses for our initial business combination and may negatively
affect our reputation, which may impede our ability to complete an initial business combination.
If we seek shareholder approval of our initial
business combination, our initial shareholders and management team have agreed to vote in favor of such initial business combination,
regardless of how our public shareholders vote.
Our initial shareholders owned 20% of our issued
and outstanding ordinary shares immediately following the completion of the initial public offering. Our initial shareholders and management
team also may from time to time purchase Class A ordinary shares prior to our initial business combination. Our amended and restated memorandum
and articles of association provides that, if we seek shareholder approval of an initial business combination, such initial business combination
will be approved if we receive an ordinary resolution under Cayman Islands law, which requires the affirmative vote of a majority of the
shareholders who attend and vote at a general meeting of the company, including the founder shares. As a result, in addition to our initial
shareholders’ founder shares, we would need 21,562,500, or 37.5%, of the 57,500,000 public shares sold in the initial public offering
to be voted in favor of an initial business combination in order to have our initial business combination approved (assuming all outstanding
shares are voted, the over-allotment option is not exercised and the parties to the letter agreement do not acquire any Class A ordinary
shares). Accordingly, if we seek shareholder approval of our initial business combination, the agreement by our initial shareholders and
management team to vote in favor of our initial business combination will increase the likelihood that we will receive an ordinary resolution,
being the requisite shareholder approval for such initial business combination.
The ability of our public shareholders to redeem
their shares for cash may make our financial condition unattractive to potential business combination targets, which may make it difficult
for us to enter into a business combination with a target.
We may seek to enter into a business combination
transaction agreement with minimum cash requirement for (i) cash consideration to be paid to the target or its owners, (ii) cash
for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions. If too many public
shareholders exercise their redemption rights, we would not be able to meet such closing condition and, as a result, would not be able
to proceed with the business combination. Furthermore, in no event will we redeem our public shares in an amount that would cause our
net tangible assets to be less than $5,000,001. Consequently, if accepting all properly submitted redemption requests would cause our
net tangible assets to be less than $5,000,001 or make us unable to satisfy a minimum cash 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 business combination transaction with us.
The ability of our public shareholders to exercise
redemption rights with respect to a large number of our shares may not allow us to complete the most desirable business combination or
optimize our capital structure.
At the time we enter into an agreement for our
initial business combination, we will not know how many shareholders may exercise their redemption rights, and therefore will need to
structure the transaction based on our expectations as to the number of shares that will be submitted for redemption. If our initial business
combination agreement requires us to use a portion of the cash in the trust account to pay the purchase price, or requires us to have
a minimum amount of cash at closing, we will need to reserve a portion of the cash in the trust account to meet such requirements, or
arrange for third party financing. In addition, if a larger number of shares are submitted for redemption than we initially expected,
we may need to restructure the transaction to reserve a greater portion of the cash in the trust account or arrange for third party financing.
Raising additional third party financing may involve dilutive equity issuances or the incurrence of indebtedness at higher than desirable
levels. Furthermore, this dilution would increase to the extent that the anti-dilution provision of the Class B ordinary shares results
in the issuance of Class A ordinary shares on a greater than one-to-one basis upon conversion of the Class B ordinary shares at the time
of our initial business combination. In addition, the amount of the deferred underwriting commissions payable to the underwriters will
not be adjusted for any shares that are redeemed in connection with an initial business combination. The per share amount we will distribute
to shareholders who properly exercise their redemption rights will not be reduced by the deferred underwriting commission and after such
redemptions, the amount held in trust will continue to reflect our obligation to pay the entire deferred underwriting commissions. The
above considerations may limit our ability to complete the most desirable business combination available to us or optimize our capital
structure.
The ability of our public shareholders to exercise
redemption rights with respect to a large number of our shares could increase the probability that our initial business combination would
be unsuccessful and that you would have to wait for liquidation in order to redeem your shares.
If our initial business combination agreement
requires us to use a portion of the cash in the trust account to pay the purchase price, or requires us to have a minimum amount of cash
at closing, the probability that our initial business combination would be unsuccessful is increased. If our initial business combination
is unsuccessful, you would not receive your pro rata portion of the trust account until we liquidate the trust account. If you are in
need of immediate liquidity, you could attempt to sell your shares in the open market; however, at such time our shares may trade at a
discount to the pro rata amount per share in the trust account. In either situation, you may suffer a material loss on your investment
or lose the benefit of funds expected in connection with your exercise of redemption rights until we liquidate or you are able to sell
your shares in the open market.
The requirement that we complete our initial
business combination by December 21, 2022 may give potential target businesses leverage over us in negotiating a business combination
and may limit the time we have in which to conduct due diligence on potential business combination targets, in particular as we approach
our dissolution deadline, which could undermine our ability to complete our initial business combination on terms that would produce value
for our shareholders.
Any potential target business with which we enter
into negotiations concerning a business combination will be aware that we must complete our initial business combination by December 21,
2022. Consequently, such target business may obtain leverage over us in negotiating a business combination, knowing that if we do not
complete our initial business combination with that particular target business, we may be unable to complete our initial business combination
with any target business. This risk will increase as we get closer to the timeframe described above. In addition, we may have limited
time to conduct due diligence and may enter into our initial business combination on terms that we would have rejected upon a more comprehensive
investigation.
Our 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
outbreak and the status of debt and equity markets.
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, U.S. Health and Human Services Secretary Alex M.
Azar II 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 and a significant
outbreak of other infectious diseases could result in a widespread health crisis that could adversely affect the economies and financial
markets worldwide, and the business of any potential target business with which we consummate a business combination could be materially
and adversely affected. Furthermore, we may be unable to complete a business combination if continued concerns relating to COVID-19 continues
to restrict travel, limit the ability to have meetings with potential investors or the target company’s personnel, vendors and services
providers are unavailable to negotiate and consummate a transaction in a timely manner. The extent to which COVID-19 impacts our search
for a business combination will depend on future developments, which are highly uncertain and cannot be predicted, including new information
which may emerge concerning the severity of COVID-19 and the actions to contain COVID-19 or treat its impact, among others. If the disruptions
posed by COVID-19 or other matters of global concern continue for an extensive period of time, our ability to consummate a business combination,
or the operations of a target business with which we ultimately consummate a business combination, may be materially adversely affected.
In addition, our ability to consummate a transaction
may be dependent on the ability to raise equity and debt financing which may be impacted by COVID-19 and other events, including as a
result of increased market volatility, decreased market liquidity in third-party financing being unavailable on terms acceptable to us
or at all.
We may not be able to complete our initial
business combination by December 21, 2022, in which case we would cease all operations except for the purpose of winding up and we would
redeem our public shares and liquidate.
We may not be able to find a suitable target business
and complete our initial business combination by December 21, 2022 after the closing of the initial public offering. Our ability to complete
our initial business combination may be negatively impacted by general market conditions, volatility in the capital and debt markets and
the other risks described herein. For example, the outbreak of COVID-19 continues to grow both in the U.S. and globally and, while the
extent of the impact of the outbreak on us will depend on future developments, it could limit our ability to complete our initial business
combination, including as a result of increased market volatility, decreased market liquidity and third-party financing being unavailable
on terms acceptable to us or at all. Furthermore, we may be unable to complete a business combination if continued concerns relating to
COVID-19 restrict travel, limit the ability to have meetings with potential investors or the target company’s personnel, vendors
and services providers are unavailable to negotiate and consummate a transaction in a timely manner. Additionally, the outbreak of COVID-19
may negatively impact businesses we may seek to acquire. If we have not completed our initial business combination within such time period,
we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten
business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit
in the trust account, including interest earned on the funds held in the trust account (less taxes payable and up to $100,000 of interest
to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public
shareholders’ rights as shareholders (including the right to receive further liquidation distributions, if any) and (iii) as promptly
as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our board of directors, liquidate
and dissolve, subject in the case of clauses (ii) and (iii), to our obligations under Cayman Islands law to provide for claims of creditors
and in all cases subject to the other requirements of applicable law.
If
we seek shareholder approval of our initial business combination, the Sponsor, initial shareholders, directors, officers, advisors and
their affiliates may elect to purchase shares or public warrants from public shareholders, which may influence a vote on a proposed business
combination and reduce the public “float” of our Class A ordinary shares.
If
we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business
combination pursuant to the tender offer rules, our Sponsor, directors, officers, advisors or their affiliates may purchase shares or
public warrants in privately negotiated transactions or in the open market either prior to or following the completion of our initial
business combination, although they are under no obligation to do so. There is no limit on the number of shares our initial shareholders,
directors, officers, advisors or their affiliates may purchase in such transactions, subject to compliance with applicable law and Nasdaq
rules. However, they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms
or conditions for any such transactions. None of the funds in the trust account will be used to purchase shares or public warrants in
such transactions. Such purchases may include a contractual acknowledgment that such shareholder, although still the record holder of
our shares, is no longer the beneficial owner thereof and therefore agrees not to exercise its redemption rights.
In
the event that our Sponsor, directors, officers, advisors or their affiliates purchase shares in privately negotiated transactions from
public shareholders who have already elected to exercise their redemption rights, such selling shareholders would be required to revoke
their prior elections to redeem their shares. The purpose of any such purchases of shares could be to vote such shares in favor of the
business combination and thereby increase the likelihood of obtaining shareholder approval of the business combination or to satisfy
a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing
of our initial business combination, where it appears that such requirement would otherwise not be met. The purpose of any such purchases
of public warrants could be to reduce the number of public warrants outstanding or to vote such warrants on any matters submitted to
the warrant holders for approval in connection with our initial business combination. Any such purchases of our securities may result
in the completion of our initial business combination that may not otherwise have been possible. Any such purchases will be reported
pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements.
In
addition, if such purchases are made, the public “float” of our Class A ordinary shares or public warrants and the number
of beneficial holders of our securities may be reduced, possibly making it difficult to obtain or maintain the quotation, listing or
trading of our securities on a national securities exchange.
If
a shareholder fails to receive notice of our offer to redeem our public shares in connection with our initial business combination, or
fails to comply with the procedures for tendering its shares, such shares may not be redeemed.
We
will comply with the proxy rules or tender offer rules, as applicable, when conducting redemptions in connection with our initial business
combination. Despite our compliance with these rules, if a shareholder fails to receive our proxy materials or tender offer documents,
as applicable, such shareholder may not become aware of the opportunity to redeem its shares. In addition, proxy materials or tender
offer documents, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination
will describe the various procedures that must be complied with in order to validly tender or submit public shares for redemption. For
example, we intend to require our public shareholders seeking to exercise their redemption rights, whether they are record holders or
hold their shares in “street name,” to, at the holder’s option, either deliver their stock certificates to our transfer
agent, or to deliver their shares to our transfer agent electronically prior to the date set forth in the proxy materials or tender offer
documents, as applicable. In the case of proxy materials, this date may be up to two business days prior to the date on which the vote
on the proposal to approve the initial business combination is to be held. In addition, if we conduct redemptions in connection with
a shareholder vote, we intend to require a public shareholder seeking redemption of its public shares to also submit a written request
for redemption to our transfer agent two business days prior to the vote in which the name of the beneficial owner of such shares is
included. In the event that a shareholder fails to comply with these or any other procedures disclosed in the proxy or tender offer materials,
as applicable, its shares may not be redeemed.
You
will not have any rights or interests in funds from the trust account, except under certain limited circumstances. Therefore, to liquidate
your investment, you may be forced to sell your public shares or warrants, potentially at a loss.
Our
public shareholders will be entitled to receive funds from the trust account only upon the earliest to occur of: (i) our completion of
an initial business combination, and then only in connection with those Class A ordinary shares that such shareholder properly elected
to redeem, subject to the limitations and on the conditions described herein, (ii) the redemption of any public shares properly submitted
in connection with a shareholder vote to amend our amended and restated memorandum and articles of association (A) to modify the substance
or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares
if we do not complete our initial business combination by December 21, 2022 or (B) with respect to any other material provisions relating
to shareholders’ rights or pre-initial business combination activity, and (iii) the redemption of our public shares if we are unable
to complete an initial business combination by December 21, 2022, subject to applicable law and as further described herein. In no other
circumstances will a public shareholder have any right or interest of any kind in the trust account. Holders of warrants will not have
any right to the 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.
You
will not be entitled to protections normally afforded to investors of many other blank check companies.
Since
the net proceeds of the initial public offering and the sale of the private placement warrants are intended to be used to complete an
initial business combination with a target business that has not been selected, we may be deemed to be a “blank check” company
under the United States securities laws. However, because we will have net tangible assets in excess of $5,000,000 upon the completion
of the initial public offering and the sale of the private placement warrants and will file a Current Report on Form 8-K, including an
audited balance sheet demonstrating this fact, we are exempt from rules promulgated by the SEC to protect investors in blank check companies,
such as Rule 419. Accordingly, investors will not be afforded the benefits or protections of those rules. Among other things, this means
our units will be immediately tradable and we will have a longer period of time to complete our initial business combination than do
companies subject to Rule 419. Moreover, if the initial public offering were subject to Rule 419, that rule 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 an initial business combination.
If
we seek shareholder approval of our initial business combination and we do not conduct redemptions pursuant to the tender offer rules,
and if you or a “group” of shareholders are deemed to hold in excess of 15% of our Class A ordinary shares, you will lose
the ability to redeem all such shares in excess of 15% of our Class A ordinary shares.
If
we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business
combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association provides that a public
shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as
a “group” (as defined under Section 13 of the Exchange Act), will be restricted from seeking redemption rights with respect
to more than an aggregate of 15% of the shares sold in the initial public offering without our prior consent, which we refer to as the
“Excess Shares.” However, we would not be restricting our shareholders’ ability to vote all of their shares (including
Excess Shares) for or against our initial business combination. Your inability to redeem the Excess Shares will reduce your influence
over our ability to complete our initial business combination and you could suffer a material loss on your investment in us if you sell
Excess Shares in open market transactions. Additionally, you will not receive redemption distributions with respect to the Excess Shares
if we complete our initial business combination. And as a result, you will continue to hold that number of shares exceeding 15% and,
in order to dispose of such shares, would be required to sell your shares in open market transactions, potentially at a loss.
Because
of our limited resources and the significant competition for business combination opportunities, it may be more difficult for us to complete
our initial business combination. If we are unable to complete our initial business combination, our public shareholders may receive
only their pro rata portion of the funds in the trust account that are available for distribution to public shareholders, and our warrants
will expire worthless.
We
expect to encounter competition from other entities having a business objective similar to ours, including private investors (which may
be individuals or investment partnerships), other blank check companies and other entities, domestic and international, competing for
the types of businesses we intend to acquire. Many of these individuals and entities are well-established and have extensive experience
in identifying and effecting, directly or indirectly, acquisitions of companies operating in or providing services to various industries.
Many of these competitors possess similar or greater technical, human and other resources to ours or more local industry knowledge than
we do and our financial resources will be relatively limited when contrasted with those of many of these competitors. While we believe
there are numerous target businesses we could potentially acquire with the net proceeds of the initial public offering and the sale of
the private placement warrants, our ability to compete with respect to the acquisition of certain target businesses that are sizable
will be limited by our available financial resources. This inherent competitive limitation gives others an advantage in pursuing the
acquisition of certain target businesses. Furthermore, we are obligated to offer holders of our public shares the right to redeem their
shares for cash at the time of our initial business combination in conjunction with a shareholder vote or via a tender offer. Target
companies will be aware that this may reduce the resources available to us for our initial business combination. Any of these obligations
may place us at a competitive disadvantage in successfully negotiating a business combination. If we are unable to complete our initial
business combination, our public shareholders may receive only their pro rata portion of the funds in the trust account that are available
for distribution to public shareholders, and our warrants will expire worthless.
If
the net proceeds of the initial public offering and the sale of the private placement warrants not being held in the trust account are
insufficient to allow us to operate for at least until December 21, 2022, it could limit the amount available to fund our search for
a target business or businesses and complete our initial business combination, and we will depend on loans from our Sponsor or management
team to fund our search and to complete our initial business combination.
Of
the net proceeds of the initial public offering, only $1,000,000 will be available to us initially outside the trust account to fund
our working capital requirements. We believe that, upon closing of the initial public offering, the funds available to us outside of
the trust account will be sufficient to allow us to operate for at least until December 21, 2022; however, we cannot assure you that
our estimate is accurate. Of the funds available to us, we could use a portion of the funds available to us to pay fees to consultants
to assist us with our search for a target business. We could also use a portion of the funds as a down payment or to fund a “no-shop”
provision (a provision in letters of intent or merger agreements designed to keep target businesses from “shopping” around
for transactions with other companies or investors on terms more favorable to such target businesses) with respect to a particular proposed
business combination, although we do not have any current intention to do so. If we entered into a letter of intent or merger agreement
where we paid for the right to receive exclusivity from a target business and were subsequently required to forfeit such funds (whether
as a result of our breach or otherwise), we might not have sufficient funds to continue searching for, or conduct due diligence with
respect to, a target business.
Prior
to the completion of our initial business combination, we do not expect to seek loans from parties other than our Sponsor or an affiliate
of our Sponsor as we do not believe third parties will be willing to loan such funds and provide a waiver against any and all rights
to seek access to funds in our trust account. If we are unable to complete our initial business combination because we do not have sufficient
funds available to us, we will be forced to cease operations and liquidate the trust account. Consequently, our public shareholders may
only receive an estimated $10.00 per share, or possibly less, on our redemption of our public shares, and our warrants will expire worthless.
Subsequent
to our completion of our initial business combination, we may be required to take write-downs or write-offs, restructuring and impairment
or other charges that could have a significant negative effect on our financial condition, results of operations and our share price,
which could cause you to lose some or all of your investment.
Even
if we conduct due diligence on a target business with which we combine, we cannot assure you that this diligence will identify all material
issues that may be present within a particular target business, that it would be possible to uncover all material issues through a customary
amount of due diligence, or that factors outside of the target business and outside of our control will not later arise. As a result
of these factors, we may be forced to later write-down or write-off assets, restructure our operations, or incur impairment or other
charges that could result in our reporting losses. Even if our due diligence successfully identifies certain risks, unexpected risks
may arise and previously known risks may materialize in a manner not consistent with our preliminary risk analysis. Even though these
charges may be non-cash items and not have an immediate impact on our liquidity, the fact that we report charges of this nature could
contribute to negative market perceptions about us or our securities. In addition, charges of this nature may cause us to violate net
worth or other covenants to which we may be subject as a result of assuming pre-existing debt held by a target business or by virtue
of our obtaining debt financing to partially finance the initial business combination or thereafter. Accordingly, any shareholders who
choose to remain shareholders following the business combination could suffer a reduction in the value of their securities. Such shareholders
are unlikely to have a remedy for such reduction in value unless they are able to successfully claim that the reduction was due to the
breach by our officers or directors of a duty of care or other fiduciary duty owed to them, or if they are able to successfully bring
a private claim under securities laws that the proxy solicitation or tender offer materials, as applicable, relating to the business
combination contained an actionable material misstatement or material omission.
If
third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received
by shareholders may be less than $10.00 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, prospective target businesses and other entities with which we do business execute agreements with us waiving
any right, title, interest or claim of any kind in or to any monies held in the trust account for the benefit of our public shareholders,
such parties may not execute such agreements, or even if they execute such agreements they may not be prevented from bringing claims
against the trust account, including, but not limited to, fraudulent inducement, breach of fiduciary responsibility or other similar
claims, as well as claims challenging the enforceability of the waiver, in each case in order to gain advantage with respect to a claim
against our assets, including the funds held in the trust account. If any third party refuses to execute an agreement waiving such claims
to the monies held in the trust account, our management will consider whether competitive alternatives are reasonably available to us
and will only enter into an agreement with such third party if management believes that such third party’s engagement would be
in the best interests of the company under the circumstances. Marcum LLP, our independent registered public accounting firm, and the
underwriters of the initial public offering will not execute agreements with us waiving such claims to the monies held in the trust account.
Examples
of possible instances where we may engage a third party that refuses to execute a waiver include the engagement of a third party consultant
whose particular expertise or skills are believed by management to be significantly superior to those of other consultants that would
agree to execute a waiver or in cases where management is unable to find a service provider willing to execute a waiver. In addition,
there is no guarantee that such entities will agree to waive any claims they may have in the future as a result of, or arising out of,
any negotiations, contracts or agreements with us and will not seek recourse against the trust account for any reason. Upon redemption
of our public shares, if we are unable to complete our initial business combination within the prescribed timeframe, or upon the exercise
of a redemption right in connection with our initial business combination, we will be required to provide for payment of claims of creditors
that were not waived that may be brought against us within the 10 years following redemption. Accordingly, the per-share redemption amount
received by public shareholders could be less than the $10.00 per public share initially held in the trust account, due to claims of
such creditors. Pursuant to the letter agreement the form of which is filed as an exhibit to the registration statement, our Sponsor
has agreed that it will be liable to us if and to the extent any claims by a third party for services rendered or products sold to us,
or a prospective target business with which we have entered into a written letter of intent, confidentiality or other similar agreement
or business combination agreement, reduce the amount of funds in the trust account to below the lesser of (i) $10.00 per public share
and (ii) the actual amount per public share held in the trust account as of the date of the liquidation of the trust account, if less
than $10.00 per share due to reductions in the value of the trust assets, less taxes payable, provided that such liability will not apply
to any claims by a third party or prospective target business who executed a waiver of any and all rights to the monies held in the trust
account (whether or not such waiver is enforceable) nor will it apply to any claims under our indemnity of the underwriters of the initial
public offering against certain liabilities, including liabilities under the Securities Act of 1933, as amended (“Securities Act”).
However, we have not asked our Sponsor to reserve for such indemnification obligations, nor have we independently verified whether our
Sponsor has sufficient funds to satisfy its indemnity obligations and we believe that our Sponsor’s only assets are securities
of our company. Therefore, we cannot assure you that our Sponsor would be able to satisfy those obligations. As a result, if any such
claims were successfully made against the trust account, the funds available for our initial business combination and redemptions could
be reduced to less than $10.00 per public share. In such event, we may not be able to complete our initial business combination, and
you would receive such lesser amount per share in connection with any redemption of your public shares. None of our officers or directors
will indemnify us for claims by third parties including, without limitation, claims by vendors and prospective target businesses.
Our
directors may decide not to enforce the indemnification obligations of our Sponsor, resulting in a reduction in the amount of funds in
the trust account available for distribution to our public shareholders.
In
the event that the proceeds in the trust account are reduced below the lesser of (i) $10.00 per share and (ii) the actual amount per
public share held in the trust account as of the date of the liquidation of the trust account if less than $10.00 per share due to reductions
in the value of the trust assets, in each case less taxes payable, and our Sponsor asserts that it is unable to satisfy his obligations
or that he has no indemnification obligations related to a particular claim, our independent directors would determine whether to take
legal action against our Sponsor to enforce its indemnification obligations. While we currently expect that our independent directors
would take legal action on our behalf against our Sponsor to enforce its indemnification obligations to us, it is possible that our independent
directors in exercising their business judgment and subject to their fiduciary duties may choose not to do so in any particular instance
if, for example, the cost of such legal action is deemed by the independent directors to be too high relative to the amount recoverable
or if the independent directors determine that a favorable outcome is not likely. If our independent directors choose not to enforce
these indemnification obligations, the amount of funds in the trust account available for distribution to our public shareholders may
be reduced below $10.00 per share.
We
may not have sufficient funds to satisfy indemnification claims of our directors and officers.
We
have agreed to indemnify our officers and directors to the fullest extent permitted by law. However, our officers and directors have
agreed to waive any right, title, interest or claim of any kind in or to any monies in the trust account and to not seek recourse against
the trust account for any reason whatsoever. Accordingly, any indemnification provided will be able to be satisfied by us only if (i)
we have sufficient funds outside of the trust account or (ii) we consummate an initial business combination. Our obligation to indemnify
our officers and directors may discourage shareholders from bringing a lawsuit against our officers or directors for breach of their
fiduciary duty. These provisions also may have the effect of reducing the likelihood of derivative litigation against our officers and
directors, even though such an action, if successful, might otherwise benefit us and our shareholders. Furthermore, a shareholder’s
investment may be adversely affected to the extent we pay the costs of settlement and damage awards against our officers and directors
pursuant to these indemnification provisions.
If,
after we distribute the proceeds in the trust account to our public shareholders, we file a bankruptcy or insolvency petition or an involuntary
bankruptcy or insolvency petition is filed against us that is not dismissed, a bankruptcy or insolvency court may seek to recover such
proceeds, and the members of our board of directors may be viewed as having breached their fiduciary duties to our creditors, thereby
exposing the members of our board of directors and us to claims of punitive damages.
If,
after we distribute the proceeds in the trust account to our public shareholders, we file a bankruptcy or insolvency petition or an involuntary
bankruptcy or insolvency petition is filed against us that is not dismissed, any distributions received by shareholders could be viewed
under applicable debtor/creditor and/or bankruptcy laws as either a “preferential transfer” or a “fraudulent conveyance.”
As a result, a bankruptcy or insolvency court could seek to recover some or all amounts received by our shareholders. In addition, our
board of directors may be viewed as having breached its fiduciary duty to our creditors and/or having acted in bad faith, thereby exposing
itself and us to claims of punitive damages, by paying public shareholders from the trust account prior to addressing the claims of creditors.
If,
before distributing the proceeds in the trust account to our public shareholders, we file a bankruptcy or insolvency petition or an involuntary
bankruptcy or insolvency petition is filed against us that is not dismissed, the claims of creditors in such proceeding may have priority
over the claims of our shareholders and the per-share amount that would otherwise be received by our shareholders in connection with
our liquidation may be reduced.
If,
before distributing the proceeds in the trust account to our public shareholders, we file a bankruptcy or insolvency petition or an involuntary
bankruptcy or insolvency 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 shareholders. To the extent any bankruptcy claims deplete the trust account, the per-share amount that would otherwise
be received by our shareholders in connection with our liquidation may be reduced.
Our
shareholders may be held liable for claims by third parties against us to the extent of distributions received by them upon redemption
of their shares.
If
we are forced to enter into an insolvent liquidation, any distributions received by shareholders could be viewed as an unlawful payment
if it was proved that immediately following the date on which the distribution was made, we were unable to pay our debts as they fall
due in the ordinary course of business. As a result, a liquidator could seek to recover some or all amounts received by our shareholders.
Furthermore, our directors may be viewed as having breached their fiduciary duties to us or our creditors and/or may have acted in bad
faith, thereby exposing themselves and our company to claims, by paying public shareholders from the trust account prior to addressing
the claims of creditors. We cannot assure you that claims will not be brought against us for these reasons. We and our directors and
officers who knowingly and willfully authorized or permitted any distribution to be paid out of our share premium account while we were
unable to pay our debts as they fall due in the ordinary course of business would be guilty of an offence and may be liable to a fine
of $18,293 and to imprisonment for five years in the Cayman Islands.
We
may not hold an annual general meeting until after the consummation of our initial business combination, which could delay the opportunity
for our shareholders to appoint directors.
In
accordance with Nasdaq corporate governance requirements, we are not required to hold an annual general meeting until no later than one
year after our first fiscal year end following our listing on Nasdaq. There is no requirement under the Companies Law for us to hold
annual or extraordinary general meetings to appoint directors. Until we hold an annual general meeting, public shareholders may not be
afforded the opportunity to appoint directors and to discuss company affairs with management. Our board of directors is divided into
three classes with only one class of directors being appointed in each year and each class (except for those directors appointed prior
to our first annual general meeting) serving a three-year term. In addition, as holders of our Class A ordinary shares, our public shareholders
will not have the right to vote on the appointment of directors until after the consummation of our initial business combination.
Because
we are neither limited to evaluating a target business in a particular industry sector nor have we selected any target businesses with
which to pursue our initial business combination, you will be unable to ascertain the merits or risks of any particular target business’s
operations.
Our
efforts to identify a prospective initial business combination target will not be limited to a particular industry, sector or geographic
region. While we may pursue an initial business combination opportunity in any industry or sector, we intend to capitalize on the ability
of our management team to identify and acquire a business or businesses that can benefit from our management team’s established
global relationships and operating experience. Our management team has extensive experience in identifying and executing strategic investments
globally and has done so successfully in a number of sectors, including global technology sectors. Our amended and restated memorandum
and articles of association prohibits us from effectuating a business combination with another blank check company or similar company
with nominal operations. Because we have not yet selected any specific target business with respect to a business combination, there
is no basis to evaluate the possible merits or risks of any particular target business’s operations, results of operations, cash
flows, liquidity, financial condition or prospects. To the extent we complete our initial business combination, we may be affected by
numerous risks inherent in the business operations with which we combine. For example, if we combine with a financially unstable business
or an entity lacking an established record of sales or earnings, we may be affected by the risks inherent in the business and operations
of a financially unstable or a development stage entity. Although our officers and directors will endeavor to evaluate the risks inherent
in a particular target business, we cannot assure you that we will properly ascertain or assess all of the significant risk factors or
that we will have adequate time to complete due diligence. Furthermore, some of these risks may be outside of our control and leave us
with no ability to control or reduce the chances that those risks will adversely impact a target business. We also cannot assure you
that an investment in our units will ultimately prove to be more favorable to investors than a direct investment, if such opportunity
were available, in a business combination target. Accordingly, any shareholders who choose to remain shareholders following the business
combination could suffer a reduction in the value of their securities. Such shareholders are unlikely to have a remedy for such reduction
in value unless they are able to successfully claim that the reduction was due to the breach by our officers or directors of a duty of
care or other fiduciary duty owed to them, or if they are able to successfully bring a private claim under securities laws that the proxy
solicitation or tender offer materials, as applicable, relating to the business combination contained an actionable material misstatement
or material omission.
We
may seek business combination opportunities in industries or sectors that may be outside of our management’s areas of expertise.
We
will consider a business combination outside of our management’s areas of expertise if a business combination candidate is presented
to us and we determine that such candidate offers an attractive business combination opportunity for our company. Although our management
will endeavor to evaluate the risks inherent in any particular business combination candidate, we cannot assure you that we will adequately
ascertain or assess all of the significant risk factors. We also cannot assure you that an investment in our units will not ultimately
prove to be less favorable to investors in the initial public offering than a direct investment, if an opportunity were available, in
a business combination candidate. In the event we elect to pursue a business combination outside of the areas of our management’s
expertise, our management’s expertise may not be directly applicable to its evaluation or operation, and the information regarding
the areas of our management’s expertise would not be relevant to an understanding of the business that we elect to acquire. As
a result, our management may not be able to ascertain or assess adequately all of the relevant risk factors. Accordingly, any shareholders
who choose to remain shareholders following our initial business combination could suffer a reduction in the value of their shares. Such
shareholders are unlikely to have a remedy for such reduction in value.
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, it is possible that a target business
with which we enter into our initial business combination will not have all of these positive attributes. If we complete our initial
business combination with a target that does not meet some or all of these guidelines, such combination may not be as successful as a
combination with a business that does meet all of our general criteria and guidelines. In addition, if we announce a prospective business
combination with a target that does not meet our general criteria and guidelines, a greater number of shareholders may exercise their
redemption rights, which may make it difficult for us to meet any closing condition with a target business that requires us to have a
minimum net worth or a certain amount of cash. In addition, if shareholder approval of the transaction is required by law, or we decide
to obtain shareholder approval for business or other reasons, it may be more difficult for us to attain shareholder approval of our initial
business combination if the target business does not meet our general criteria and guidelines. If we are unable to complete our initial
business combination, our public shareholders may only receive their pro rata portion of the funds in the trust account that are available
for distribution to public shareholders, and our warrants will expire worthless.
We
are not required to obtain an opinion from an independent investment banking firm or from a valuation or appraisal firm, and consequently,
you may have no assurance from an independent source that the price we are paying for the business is fair to our shareholders from a
financial point of view.
Unless
we complete our initial business combination with an affiliated entity or our board of directors cannot independently determine the fair
market value of the target business or businesses (including with the assistance of financial advisors), we are not required to obtain
an opinion from an independent investment banking firm which is a member of FINRA or from a valuation or appraisal firm that the price
we are paying is fair to our shareholders from a financial point of view. If no opinion is obtained, our shareholders will be relying
on the judgment of our board of directors, who will determine fair market value based on standards generally accepted by the financial
community. Such standards used will be disclosed in our proxy materials or tender offer documents, as applicable, related to our initial
business combination.
Because
we must furnish our shareholders with target business financial statements, we may lose the ability to complete an otherwise advantageous
initial business combination with some prospective target businesses.
The
federal proxy rules require that the proxy statement with respect to the vote on an initial business combination include historical and
pro forma financial statement disclosure. We will include the same financial statement disclosure in connection with our tender offer
documents, whether or not they are required under the tender offer rules. These financial statements may be required to be prepared in
accordance with, or be reconciled to, accounting principles generally accepted in the United States of America (“GAAP”) or
international financial reporting standards as issued by the International Accounting Standards Board (“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) (“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.
Compliance
obligations under the Sarbanes-Oxley Act may make it more difficult for us to effectuate our initial business combination, require substantial
financial and management resources, and increase the time and costs of completing an initial business combination.
Section
404 of the Sarbanes-Oxley Act requires that we evaluate and report on our system of internal controls beginning with our Annual Report
on Form 10-K for the year ending December 31, 2021. Only in the event we are deemed to be a large accelerated filer or an accelerated
filer, and no longer qualify as an emerging growth company, will we be required to comply with the independent registered public accounting
firm attestation requirement on our internal control over financial reporting. Further, for as long as we remain an emerging growth company,
we will not be required to comply with the independent registered public accounting firm attestation requirement on our internal control
over financial reporting. The fact that we are a blank check company makes compliance with the requirements of the Sarbanes-Oxley Act
particularly burdensome on us as compared to other public companies because a target business with which we seek to complete our initial
business combination may not be in compliance with the provisions of the Sarbanes-Oxley Act regarding adequacy of its internal controls.
The development of the internal control of any such entity to achieve compliance with the Sarbanes-Oxley Act may increase the time and
costs necessary to complete any such business combination.
We
do not have a specified maximum redemption threshold. The absence of such a redemption threshold may make it possible for us to complete
our initial business combination with which a substantial majority of our shareholders do not agree.
Our
amended and restated memorandum and articles of association provide that in no event will we redeem our public shares in an amount that
would cause our net tangible assets to be less than $5,000,001. In addition, our proposed initial business combination may impose a minimum
cash requirement for (i) cash consideration to be paid to the target or its owners, (ii) cash for working capital or other general corporate
purposes or (iii) the retention of cash to satisfy other conditions. As a result, we may be able to complete our initial business combination
even though a substantial majority of our public shareholders do not agree with the transaction and have redeemed their shares or, if
we seek shareholder approval of our initial business combination and do not conduct redemptions in connection with our initial business
combination pursuant to the tender offer rules, have entered into privately negotiated agreements to sell their shares to our Sponsor,
officers, directors, advisors or any of their affiliates. In the event the aggregate cash consideration we would be required to pay for
all Class A ordinary shares that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to
the terms of the proposed business combination exceed the aggregate amount of cash available to us, we will not complete the business
combination or redeem any shares, all Class A ordinary shares submitted for redemption will be returned to the holders thereof, and we
instead may search for an alternate business combination.
In
order to effectuate an initial business combination, special purpose acquisition companies have, in the recent past, amended various
provisions of their charters and other governing instruments, including their warrant agreements. We cannot assure you that we will not
seek to amend our amended and restated memorandum and articles of association or governing instruments in a manner that will make it
easier for us to complete our initial business combination that our shareholders may not support.
In
order to effectuate a business combination, special purpose acquisition companies have, in the recent past, amended various provisions
of their charters and governing instruments, including their warrant agreements. For example, special purpose acquisition companies have
amended the definition of business combination, increased redemption thresholds and extended the time to consummate an initial business
combination and, with respect to their warrants, amended their warrant agreements to require the warrants to be exchanged for cash and/or
other securities. Amending our amended and restated memorandum and articles of association will require a special resolution under Cayman
Islands law, being the affirmative vote of a majority of at least two-thirds of the shareholders who attend and vote at a general meeting
of the company, and amending our warrant agreement will require a vote of holders of at least 50% of the public warrants and, solely
with respect to any amendment to the terms of the private placement warrants or any provision of the warrant agreement with respect to
the private placement warrants, 50% of the then outstanding private placement warrants. In addition, our amended and restated memorandum
and articles of association requires us to provide our public shareholders with the opportunity to redeem their public shares for cash
if we propose an amendment to our amended and restated memorandum and articles of association (A) to modify the substance or timing of
our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do
not complete an initial business combination by December 21, 2022 or (B) with respect to any other material provisions relating to shareholders’
rights or pre-initial business combination activity. To the extent any of such amendments would be deemed to fundamentally change the
nature of the securities offered in the initial public offering, we would register, or seek an exemption from registration for, the affected
securities. We cannot assure you that we will not seek to amend our charter or governing instruments or extend the time to consummate
an initial business combination in order to effectuate our initial business combination.
The
provisions of our amended and restated memorandum and articles of association that relate to our pre-business combination activity (and
corresponding provisions of the agreement governing the release of funds from our trust account) may be amended with the approval of
holders of not less than two-thirds of our ordinary shares who attend and vote at a general meeting of the company (or 65% of our ordinary
shares with respect to amendments to the trust agreement governing the release of funds from our trust account), which is a lower amendment
threshold than that of some other special purpose acquisition companies. It may be easier for us, therefore, to amend our amended and
restated memorandum and articles of association to facilitate the completion of an initial business combination that some of our shareholders
may not support.
Our
amended and restated memorandum and articles of association provide that any of its provisions related to pre-business combination activity
(including the requirement to deposit proceeds of the initial public offering and the private placement of warrants into the trust account
and not release such amounts except in specified circumstances, and to provide redemption rights to public shareholders as described
herein) may be amended if approved by special resolution, under Cayman Islands law being the affirmative vote of a majority of at least
two-thirds of the shareholders who attend and vote at a general meeting of the company, and corresponding provisions of the trust agreement
governing the release of funds from our trust account may be amended if approved by holders of 65% of our ordinary shares. Our initial
shareholders, who will collectively beneficially own 20% of our ordinary shares upon the closing of the initial public offering (assuming
they do not purchase any units in the initial public offering), will participate in any vote to amend our amended and restated memorandum
and articles of association and/or trust agreement and will have the discretion to vote in any manner they choose. As a result, we may
be able to amend the provisions of our amended and restated memorandum and articles of association which govern our pre-business combination
behavior more easily than some other special purpose acquisition companies, and this may increase our ability to complete a business
combination with which you do not agree. Our shareholders may pursue remedies against us for any breach of our amended and restated memorandum
and articles of association.
Our
Sponsor, officers and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our
amended and restated memorandum and articles of association (A) to modify the substance or timing of our obligation to allow redemption
in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business
combination by December 21, 2022 or (B) with respect to any other material provisions relating to shareholders’ rights or pre-initial
business combination activity, unless we provide our public shareholders with the opportunity to redeem their Class A ordinary shares
upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust
account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, divided
by the number of then outstanding public shares. Our shareholders are not parties to, or third-party beneficiaries of, these agreements
and, as a result, will not have the ability to pursue remedies against our Sponsor, officers or directors for any breach of these agreements.
As a result, in the event of a breach, our shareholders would need to pursue a shareholder derivative action, subject to applicable law.
We
may be unable to obtain additional financing to complete our initial business combination or to fund the operations and growth of a target
business, which could compel us to restructure or abandon a particular business combination.
We
have not selected any specific business combination target but intend to target businesses with enterprise values that are greater than
we could acquire with the net proceeds of the initial public offering and the sale of the private placement warrants and the forward
purchase securities. As a result, if the cash portion of the purchase price exceeds the amount available from the trust account, net
of amounts needed to satisfy any redemption by public shareholders, we may be required to seek additional financing to complete such
proposed initial business combination. We cannot assure you that such financing will be available on acceptable terms, if at all. To
the extent that additional financing proves to be unavailable when needed to complete our initial business combination, we would be compelled
to either restructure the transaction or abandon that particular business combination and seek an alternative target business candidate.
Further, we may be required to obtain additional financing in connection with the closing of our initial business combination for general
corporate purposes, including for maintenance or expansion of operations of the post-transaction businesses, the payment of principal
or interest due on indebtedness incurred in completing our initial business combination, or to fund the purchase of other companies.
If we are unable to complete our initial business combination, our public shareholders may only receive their pro rata portion of the
funds in the trust account that are available for distribution to public shareholders, and our warrants will expire worthless. In addition,
even if we do not need additional financing to complete our initial business combination, we may require such financing to fund the operations
or growth of the target business. The failure to secure additional financing could have a material adverse effect on the continued development
or growth of the target business. None of our officers, directors or shareholders is required to provide any financing to us in connection
with or after our initial business combination.
Our
initial shareholders control a substantial interest in us and thus may exert a substantial influence on actions requiring a shareholder
vote, potentially in a manner that you do not support.
Our
initial shareholders own 20% of our issued and outstanding ordinary shares. Accordingly, they may exert a substantial influence on actions
requiring a shareholder vote, potentially in a manner that you do not support, including amendments to our amended and restated memorandum
and articles of association. If our initial shareholders purchase any additional Class A ordinary shares in the aftermarket or in privately
negotiated transactions, this would increase their control. Neither our initial shareholders nor, to our knowledge, any of our officers
or directors, have any current intention to purchase additional securities, other than as disclosed in this Annual Report on Form 10-K.
Factors that would be considered in making such additional purchases would include consideration of the current trading price of our
Class A ordinary shares. In addition, our board of directors, whose members were elected by our Sponsor, is and will be divided into
three classes, each of which will generally serve for a terms for three years with only one class of directors being elected in each
year. We may not hold an annual meeting of shareholders to elect new directors prior to the completion of our initial business combination,
in which case all of the current directors will continue in office until at least the completion of the business combination. 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 initial shareholders, because of their ownership position, will have considerable influence regarding
the outcome. Accordingly, our initial shareholders will continue to exert control at least until the completion of our initial business
combination.
OrION
has committed to purchase at least $100,000,000 of forward purchase units and has the right to purchase up to $200,000,000 of additional
forward purchase units concurrently with the closing of our initial business combination, but has no obligation to purchase any or all
of such additional amount. Our ability to consummate our initial business combination may be adversely impacted if OrION declines to
exercise this right.
OrION
has the right to purchase up to $200,000,000 of additional forward purchase units concurrently with the closing of our initial business
combination. If our board of directors determines that additional capital is needed in order to consummate our initial business combination
or for other reasons and OrION does not purchase the up to $200,000,000 of additional forward purchase units or such amount as our board
of directors has determined may be needed, we may not have sufficient capital to satisfy certain conditions to consummate our initial
business combination.
Resources
could be wasted in researching business combinations that are not completed, which could materially adversely affect subsequent attempts
to locate and acquire or merge with another business. If we are unable to complete our initial business combination, our public shareholders
may only receive their pro rata portion of the funds in the trust account that are available for distribution to public shareholders,
and our warrants will expire worthless.
We
anticipate that the investigation of each specific target business and the negotiation, drafting and execution of relevant agreements,
disclosure documents and other instruments will require substantial management time and attention and substantial costs for accountants,
attorneys, consultants and others. If we decide not to complete a specific initial business combination, the costs incurred up to that
point for the proposed transaction likely would not be recoverable. Furthermore, if we reach an agreement relating to a specific target
business, we may fail to complete our initial business combination for any number of reasons including those beyond our control. Any
such event will result in a loss to us of the related costs incurred which could materially adversely affect subsequent attempts to locate
and acquire or merge with another business. If we are unable to complete our initial business combination, our public shareholders may
only receive their pro rata portion of the funds in the trust account that are available for distribution to public shareholders, and
our warrants will expire worthless.
Our
key personnel may negotiate employment or consulting agreements with a target business in connection with a particular business combination,
and a particular business combination may be conditioned on the retention or resignation of such key personnel. These agreements may
provide for them to receive compensation following our initial business combination and as a result, may cause them to have conflicts
of interest in determining whether a particular business combination is the most advantageous.
Our
key personnel may be able to remain with our company after the completion of our initial business combination only if they are able to
negotiate employment or consulting agreements in connection with the business combination. Such negotiations would take place simultaneously
with the negotiation of the business combination and could provide for such individuals to receive compensation in the form of cash payments
and/or our securities for services they would render to us after the completion of the business combination. Such negotiations also could
make such key personnel’s retention or resignation a condition to any such agreement. The personal and financial interests of such
individuals may influence their motivation in identifying and selecting a target business, subject to their fiduciary duties under Cayman
Islands law.
We
may have a limited ability to assess the management of a prospective target business and, as a result, may effect our initial business
combination with a target business whose management may not have the skills, qualifications or abilities to manage a public company.
When
evaluating the desirability of effecting our initial business combination with a prospective target business, our ability to assess the
target business’s management may be limited due to a lack of time, resources or information. Our assessment of the capabilities
of the target business’s management, therefore, may prove to be incorrect and such management may lack the skills, qualifications
or abilities we suspected. Should the target business’s management not possess the skills, qualifications or abilities necessary
to manage a public company, the operations and profitability of the post-combination business may be negatively impacted. Accordingly,
any shareholders who choose to remain shareholders following the business combination could suffer a reduction in the value of their
shares. Such shareholders are unlikely to have a remedy for such reduction in value unless they are able to successfully claim that the
reduction was due to the breach by our officers or directors of a duty of care or other fiduciary duty owed to them, or if they are able
to successfully bring a private claim under securities laws that the proxy solicitation or tender offer materials, as applicable, relating
to the business combination contained an actionable material misstatement or material omission.
If
we effect our initial business combination with a company located outside of the United States, we would be subject to a variety of additional
risks that may adversely affect us.
If
we pursue a target company with operations or opportunities outside of the United States for our initial business combination, we may
face additional burdens in connection with investigating, agreeing to and completing such initial business combination, and if we effect
such initial business combination, we would be subject to a variety of additional risks that may negatively impact our operations.
If
we pursue a target a company with operations or opportunities outside of the United States for our initial business combination, we would
be subject to risks associated with cross-border business combinations, including in connection with investigating, agreeing to and completing
our initial business combination, conducting due diligence in a foreign jurisdiction, having such transaction approved by any local governments,
regulators or agencies and changes in the purchase price based on fluctuations in foreign exchange rates.
If
we effect our initial business combination with such a company, we would be subject to any special considerations or risks associated
with companies operating in an international setting, including any of the following:
|
● |
costs
and difficulties inherent in managing cross-border business operations; |
|
● |
rules
and regulations regarding currency redemption; |
|
● |
complex
corporate withholding taxes on individuals; |
|
● |
laws
governing the manner in which future business combinations may be effected; |
|
● |
exchange
listing and/or delisting requirements; |
|
● |
tariffs
and trade barriers; |
|
● |
regulations
related to customs and import/export matters; |
|
● |
local
or regional economic policies and market conditions; |
|
● |
unexpected
changes in regulatory requirements; |
|
● |
challenges
in managing and staffing international operations; |
|
● |
tax
issues, such as tax law changes and variations in tax laws as compared to the United States; |
|
● |
currency
fluctuations and exchange controls; |
|
● |
challenges
in collecting accounts receivable; |
|
● |
cultural
and language differences; |
|
● |
employment
regulations; |
|
● |
underdeveloped
or unpredictable legal or regulatory systems; |
|
● |
protection
of intellectual property; |
|
● |
social
unrest, crime, strikes, riots and civil disturbances; |
|
● |
regime
changes and political upheaval; |
|
● |
terrorist
attacks and wars; and |
|
● |
deterioration
of political relations with the United States. |
We
may not be able to adequately address these additional risks. If we were unable to do so, we may be unable to complete such initial business
combination, or, if we complete such initial business combination, our operations might suffer, either of which may adversely impact
our business, financial condition and results of operations.
We
may be a passive foreign investment company, or “PFIC,” which could result in adverse United States federal income tax consequences
to U.S. investors.
If
we are a PFIC for any taxable year (or portion thereof) that is included in the holding period of a U.S. Holder of our Class A ordinary
shares or warrants, the U.S. Holder may be subject to adverse U.S. federal income tax consequences and may be subject to additional reporting
requirements. Our PFIC status for our current and subsequent taxable years may depend on whether we qualify for the PFIC start-up exception.
Depending on the particular circumstances the application of the start-up exception may be subject to uncertainty, and there cannot be
any assurance that we will qualify for the start-up exception. Accordingly, there can be no assurances with respect to our status as
a PFIC for our current taxable year or any subsequent taxable year (and, in the case of the startup exception, potentially not until
after the two taxable years following our current taxable year). Our actual PFIC status for any taxable year, however, will not be determinable
until after the end of such taxable year. Moreover, if we determine we are a PFIC for any taxable year, upon written request, we will
endeavor to provide to a U.S. Holder such information as the Internal Revenue Service (“IRS”) may require, including a PFIC
annual information statement, in order to enable the U.S. Holder to make and maintain a “qualified electing fund” election,
but there can be no assurance that we will timely provide such required information, and such election would be unavailable with respect
to our warrants in all cases. We urge U.S. investors to consult their own tax advisors regarding the possible application of the PFIC
rules.
We
may reincorporate in another jurisdiction in connection with our initial business combination and such reincorporation may result in
taxes imposed on shareholders.
We
may, in connection with our initial business combination and subject to requisite shareholder approval by special resolution under the
Companies Law, reincorporate in the jurisdiction in which the target company or business is located or in another jurisdiction. The transaction
may require a shareholder to recognize taxable income in the jurisdiction in which the shareholder is a tax resident or in which its
members are resident if it is a tax transparent entity. We do not intend to make any cash distributions to shareholders to pay such taxes.
Shareholders may be subject to withholding taxes or other taxes with respect to their ownership of us after the reincorporation.
We
may reincorporate in another jurisdiction in connection with our initial business combination, and the laws of such jurisdiction may
govern some or all of our future material agreements and we may not be able to enforce our legal rights.
In
connection with our initial business combination, we may relocate the home jurisdiction of our business from the Cayman Islands to another
jurisdiction. If we determine to do this, the laws of such jurisdiction may govern some or all of our future material agreements. The
system of laws and the enforcement of existing laws in such jurisdiction may not be as certain in implementation and interpretation as
in the United States. The inability to enforce or obtain a remedy under any of our future agreements could result in a significant loss
of business, business opportunities or capital.
We
may issue notes or other debt securities, or otherwise incur substantial debt, to complete a business combination, which may adversely
affect our leverage and financial condition and thus negatively impact the value of our shareholders’ investment in us.
Although
we have no commitments as of the date of this Annual Report on Form 10-K to issue any notes or other debt securities, or to otherwise
incur outstanding debt following the initial public offering, we may choose to incur substantial debt to complete our initial business
combination. We and our officers have agreed that we will not incur any indebtedness unless we have obtained from the lender a waiver
of any right, title, interest or claim of any kind in or to the monies held in the trust account. As such, no issuance of debt will affect
the per share amount available for redemption from the trust account. Nevertheless, the incurrence of debt could have a variety of negative
effects, including:
|
● |
default
and foreclosure on our assets if our operating revenues after an initial business combination are insufficient to repay our debt
obligations; |
|
● |
acceleration
of our obligations to repay the indebtedness even if we make all principal and interest payments when due if we breach certain covenants
that require the maintenance of certain financial ratios or reserves without a waiver or renegotiation of that covenant; |
|
● |
our
immediate payment of all principal and accrued interest, if any, if the debt security is payable on demand; |
|
● |
our
inability to obtain necessary additional financing if the debt security contains covenants restricting our ability to obtain such
financing while the debt security is outstanding; |
|
● |
our
inability to pay dividends on our Class A ordinary shares; |
|
● |
using
a substantial portion of our cash flow to pay principal and interest on our debt, which will reduce the funds available for dividends
on our Class A ordinary shares if declared, expenses, capital expenditures, acquisitions and other general corporate purposes; |
|
● |
limitations
on our flexibility in planning for and reacting to changes in our business and in the industry in which we operate; |
|
● |
increased
vulnerability to adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation;
and |
|
● |
limitations
on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements, execution
of our strategy and other purposes and other disadvantages compared to our competitors who have less debt. |
We
may only be able to complete one business combination with the proceeds of the initial public offering and the sale of the private placement
warrants, which will cause us to be solely dependent on a single business which may have a limited number of products or services. This
lack of diversification may negatively impact our operations and profitability.
The
net proceeds from the initial public offering and the private placement provided us with $575,000,000 that we may use to complete our
initial business combination (after taking into account the $20,125,000 of deferred underwriting commissions being held in the trust
account).
We
may effectuate our initial business combination with a single target business or multiple target businesses simultaneously or within
a short period of time. However, we may not be able to effectuate our initial business combination with more than one target business
because of various factors, including the existence of complex accounting issues and the requirement that we prepare and file pro forma
financial statements with the SEC that present operating results and the financial condition of several target businesses as if they
had been operated on a combined basis. By completing our initial business combination with only a single entity, our lack of diversification
may subject us to numerous economic, competitive and regulatory developments. Further, we would not be able to diversify our operations
or benefit from the possible spreading of risks or offsetting of losses, unlike other entities which may have the resources to complete
several business combinations in different industries or different areas of a single industry. Accordingly, the prospects for our success
may be:
|
● |
solely
dependent upon the performance of a single business, property or asset, or |
|
● |
dependent
upon the development or market acceptance of a single or limited number of products, processes or services. |
This
lack of diversification may subject us to numerous economic, competitive and regulatory risks, any or all of which may have a substantial
adverse impact upon the particular industry in which we may operate subsequent to our initial business combination.
We
may attempt to simultaneously complete business combinations with multiple prospective targets, which may hinder our ability to complete
our initial business combination and give rise to increased costs and risks that could negatively impact our operations and profitability.
If
we determine to simultaneously acquire several businesses that are owned by different sellers, we will need for each of such sellers
to agree that our purchase of its business is contingent on the simultaneous closings of the other business combinations, which may make
it more difficult for us, and delay our ability, to complete our initial business combination. With multiple business combinations, we
could also face additional risks, including additional burdens and costs with respect to possible multiple negotiations and due diligence
investigations (if there are multiple sellers) and the additional risks associated with the subsequent assimilation of the operations
and services or products of the acquired companies in a single operating business. If we are unable to adequately address these risks,
it could negatively impact our profitability and results of operations.
We
may attempt to complete our initial business combination with a private company about which little information is available, which may
result in a business combination with a company that is not as profitable as we suspected, if at all.
In
pursuing our business combination strategy, we may seek to effectuate our initial business combination with a privately held company.
Very little public information generally exists about private companies, and we could be required to make our decision on whether to
pursue a potential initial business combination on the basis of limited information, which may result in a business combination with
a company that is not as profitable as we suspected, if at all.
Risks
Relating to our Sponsor and Management Team
Our
ability to successfully effect our initial business combination and to be successful thereafter will be dependent upon the efforts of
our key personnel, some of whom may join us following our initial business combination. The loss of key personnel could negatively impact
the operations and profitability of our post-combination business.
Our
ability to successfully effect our initial business combination is dependent upon the efforts of our key personnel. The role of our key
personnel in the target business, however, cannot presently be ascertained. Although some of our key personnel may remain with the target
business in senior management or advisory positions following our initial business combination, it is likely that some or all of the
management of the target business will remain in place. While we intend to closely scrutinize any individuals we engage after our initial
business combination, we cannot assure you that our assessment of these individuals will prove to be correct. These individuals may be
unfamiliar with the requirements of operating a company regulated by the SEC, which could cause us to have to expend time and resources
helping them become familiar with such requirements.
We are dependent upon our 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 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 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 officers. The unexpected loss
of the services of one or more of our directors or officers could have a detrimental effect on us.
Since our Sponsor, officers and directors will
lose their entire investment in us if our initial business combination is not completed (other than with respect to public shares they
may acquire during or after the initial public offering), a conflict of interest may arise in determining whether a particular business
combination target is appropriate for our initial business combination.
On October 7, 2020, our Sponsor paid $25,000,
or approximately $0.002 per share, to cover certain of our offering costs in exchange for 14,375,000 founder shares.
Prior to the initial investment in the company
of $25,000 by the Sponsor, the company had no assets, tangible or intangible. The purchase price of the founder shares was determined
by dividing the amount of cash contributed to the company by the number of founder shares issued. The number of founder shares outstanding
was determined based on the expectation that the total size of the initial public offering would be a maximum of 57,500,000 units if the
underwriters’ over-allotment option is exercised in full, and therefore that such founder shares would represent 20% of the outstanding
shares after the initial public offering. Up to 1,875,000 founder shares were subject to forfeiture by the Sponsor depending on the extent
to which the underwriters’ over-allotment option was exercised. In connection with the underwriters’ full exercise of their
over-allotment option on December 21, 2020, the 1,875,000 shares were no longer subject to forfeiture. The founder shares will be worthless
if we do not complete an initial business combination. In addition, our Sponsor purchased an aggregate of 9,000,000 warrants for an aggregate
purchase price of $13,500,000, or $1.50 per warrant. The private placement warrants will also be worthless if we do not complete our initial
business combination. The personal and financial interests of our officers and directors may influence their motivation in identifying
and selecting a target business combination, completing an initial business combination and influencing the operation of the business
following the initial business combination. This risk may become more acute as December 21, 2022 nears, which is the deadline for our
completion of an initial business combination.
Our executive officers and directors will allocate
their time to other businesses thereby causing conflicts of interest in their determination as to how much time to devote to our affairs.
This conflict of interest could have a negative impact on our ability to complete our initial business combination.
Our executive 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 executive officers is engaged in several other business endeavors for
which he may be entitled to substantial compensation, and our executive officers are not obligated to contribute any specific number of
hours per week to our affairs. Our independent directors also serve as officers and board members for other entities. If our executive
officers’ and directors’ other business affairs require them to devote substantial amounts of time to such affairs in excess
of their current commitment levels, it could limit their ability to devote time to our affairs which may have a negative impact on our
ability to complete our initial business combination. In particular, our officers and directors are actively engaged in ScION Tech Growth
II, a special purpose acquisition company that completed its initial public offering in February 2021. ScION Tech Growth II has until
February 12, 2023 to complete an initial business combination, and, like us, may pursue an initial business combination target in any
businesses or industry, although it is focused on a searching for an initial business combination in the same business and industry as
we are: technology-enabled businesses that offer specific technology solutions, broader technology software and services in the financial
services sector. Any such companies, businesses or investments, including ScION Tech Growth II, may present additional conflicts of interest
in pursuing an initial business combination target. However, we do not believe that any such potential conflicts would materially affect
our ability to complete our initial business combination.
Our officers and directors presently have,
and any of them in the future may have additional, fiduciary or contractual obligations to other entities and, accordingly, may have conflicts
of interest in determining to which entity a particular business opportunity should be presented.
Until we consummate our initial business combination,
we intend to engage in the business of identifying and combining with one or more businesses. Each of our officers and directors presently
has, and any of them in the future may have, additional fiduciary or contractual obligations to other entities pursuant to which such
officer or director is or will be required to present a business combination opportunity to such entity. Accordingly, they may have conflicts
of interest in determining to which entity a particular business opportunity should be presented. These conflicts may not be resolved
in our favor and a potential target business may be presented to another entity prior to its presentation to us. Our amended and restated
memorandum and articles of association provides that we renounce our interest in any corporate opportunity offered to any director or
officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of the company
and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue,
and to the extent the director or officer is permitted to refer that opportunity to us without violating another legal obligation. In
addition, our Sponsor and our officers and directors may Sponsor or form other special purpose acquisition companies similar to ours or
may pursue other business or investment ventures during the period in which we are seeking an initial business combination. As a result,
our Sponsor, officers and directors could have conflicts of interest in determining whether to present business combination opportunities
to us or to any other special purpose acquisition company with which they may become involved. In particular, our officers and directors
are actively engaged in ScION Tech Growth II, a special purpose acquisition company that completed its initial public offering in February
2021. ScION Tech Growth II has until February 12, 2023 to complete an initial business combination, and, like us, may pursue an initial
business combination target in any businesses or industry, although it is focused on a searching for an initial business combination in
the same business and industry as we are: technology-enabled businesses that offer specific technology solutions, broader technology software
and services in the financial services sector. Any such companies, businesses or ventures, including ScION Tech Growth II, may present
additional conflicts of interest in pursuing an initial business combination target. However, we do not believe that any such potential
conflicts would materially affect our ability to complete our initial business combination.
Our executive officers, directors, security
holders and their respective affiliates may have competitive pecuniary interests that conflict with our interests.
We have not adopted a policy that expressly prohibits
our directors, executive officers, security holders or affiliates from having a direct or indirect pecuniary or financial interest in
any investment to be acquired or disposed of by us or in any transaction to which we are a party or have an interest. In fact, we may
enter into a business combination with a target business that is affiliated with our Sponsor, our directors or executive officers, although
we do not intend to do so. Nor do we have a policy that expressly prohibits any such persons from engaging for their own account in business
activities of the types conducted by us. Accordingly, such persons or entities may have a conflict between their interests and ours.
Our executive officers and directors are
actively engaged in ScION Tech Growth II, a special purpose acquisition company that completed its initial public offering in February
2021, and will continue to serve as executive officers and directors of ScION Tech Growth II until the business combination. ScION Tech
Growth II has until February 12, 2023 to complete an initial business combination, and, like us, may pursue an initial business combination
target in any businesses or industry, although it is focused on a searching for an initial business combination in the same business and
industry as we are: technology-enabled businesses that offer specific technology solutions, broader technology software and services in
the financial services sector. Any such companies, businesses or investments, including ScION Tech Growth II, may present additional conflicts
of interest in pursuing an initial business combination target. However, we do not believe that any such potential conflicts would materially
affect our ability to complete our initial business combination.
The personal and financial interests of our directors
and officers may influence their motivation in timely identifying and selecting a target business and completing a business combination.
Consequently, our directors’ and officers’ discretion in identifying and selecting a suitable target business may result in
a conflict of interest when determining whether the terms, conditions and timing of a particular business combination are appropriate
and in our shareholders’ best interest. If this were the case, it would be a breach of their fiduciary duties to us as a matter
of Cayman Islands law and we or our shareholders might have a claim against such individuals for infringing on our shareholders’
rights. See the section titled “Description of Securities—Certain Differences in Corporate Law—Shareholder Suits”
in Exhibit 4.5 hereto for further information on the ability to bring such claims. However, we might not ultimately be successful in any
claim we may make against them for such reason.
We may engage in a business combination with
one or more target businesses that have relationships with entities that may be affiliated with our Sponsor, executive officers, directors
or existing holders which may raise potential conflicts of interest.
In light of the involvement of our Sponsor, executive
officers and directors with other entities, we may decide to acquire one or more businesses affiliated with our Sponsor, executive officers,
directors or existing holders. Our directors also serve as officers and board members for other entities. Such entities may compete with
us for business combination opportunities. Our Sponsor, officers and directors are not currently aware of any specific opportunities for
us to complete our initial business combination with any entities with which they are affiliated, and there have been no substantive discussions
concerning a business combination with any such entity or entities. Although we will not be specifically focusing on, or targeting, any
transaction with any affiliated entities, we would pursue such a transaction if we determined that such affiliated entity met our criteria
for a business combination and such transaction was approved by a majority of our independent and disinterested directors. Despite our
agreement to obtain an opinion from an independent investment banking firm which is a member of FINRA or a valuation or appraisal firm
regarding the fairness to our company from a financial point of view of a business combination with one or more domestic or international
businesses affiliated with our Sponsor, executive officers, directors or existing holders, potential conflicts of interest still may exist
and, as a result, the terms of the business combination may not be as advantageous to our public shareholders as they would be absent
any conflicts of interest.
The officers and directors of an acquisition
candidate may resign upon completion of our initial business combination. The loss of a business combination target’s key personnel
could negatively impact the operations and profitability of our post-combination business.
The role of an acquisition candidate’s key
personnel upon the completion of our initial business combination cannot be ascertained at this time. Although we contemplate that certain
members of an acquisition candidate’s management team will remain associated with the acquisition candidate following our initial
business combination, it is possible that members of the management of an acquisition candidate will not wish to remain in place.
Our management may not be able to maintain
control of a target business after our initial business combination. We cannot provide assurance that, upon loss of control of a target
business, new management will possess the skills, qualifications or abilities necessary to profitably operate such business.
We may structure our initial business combination
so that the post-transaction company in which our public shareholders own shares will own less than 100% of the equity interests or assets
of a target business, but we will only complete such business combination if the post-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 us not to
be required to register as an investment company under the Investment Company Act. We will not consider any transaction that does not
meet such criteria. Even if the post-transaction company owns 50% or more of the voting securities of the target, our shareholders prior
to the business combination may collectively own a minority interest in the post business combination company, depending on valuations
ascribed to the target and us in the business combination. For example, we could pursue a transaction in which we issue a substantial
number of new Class A ordinary shares in exchange for all of the outstanding capital stock, shares or other equity interests of a target.
In this case, we would acquire a 100% interest in the target. However, as a result of the issuance of a substantial number of new Class
A ordinary shares, our shareholders immediately prior to such transaction could own less than a majority of our issued and outstanding
Class A ordinary shares subsequent to such transaction. In addition, other minority shareholders may subsequently combine their holdings
resulting in a single person or group obtaining a larger share of the company’s shares than we initially acquired. Accordingly,
this may make it more likely that our management will not be able to maintain control of the target business.
Risks Relating to our Securities
If we are deemed to be an investment company
under the Investment Company Act, we may be required to institute burdensome compliance requirements and our activities may be restricted,
which may make it difficult for us to complete our initial business combination.
If we are deemed to be an investment company under
the Investment Company Act, our activities may be restricted, including:
| ● | restrictions
on the nature of our investments; and |
| ● | restrictions
on the issuance of securities, each of which may make it difficult for us to complete our initial business combination. In addition,
we may have imposed upon us burdensome requirements, including: |
| ● | registration
as an investment company with the SEC; |
| ● | adoption
of a specific form of corporate structure; and |
| ● | reporting,
record keeping, voting, proxy and disclosure requirements and other rules and regulations. |
In order not to be regulated as an investment
company under the Investment Company Act, unless we can qualify for an exclusion, we must ensure that we are engaged primarily in a business
other than investing, reinvesting or trading of securities and that our activities do not include investing, reinvesting, owning, holding
or trading “investment securities” constituting more than 40% of our assets (exclusive of U.S. government securities and cash
items) on an unconsolidated basis. Our business will be to identify and complete a business combination and thereafter to operate the
post-transaction business or assets for the long term. We do not plan to buy businesses or assets with a view to resale or profit from
their resale. We do not plan to buy unrelated businesses or assets or to be a passive investor.
We do not believe that our anticipated principal
activities will subject us to the Investment Company Act. To this end, the proceeds held in the trust account may only be invested in
United States “government securities” within the meaning of Section 2(a)(16) of the Investment Company Act having a maturity
of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act 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. The initial public offering is not intended for persons who are seeking a return on investments in government securities or investment
securities. The trust account is intended as a holding place for funds pending the earliest to occur of either: (i) the completion of
our initial business combination; (ii) the redemption of any public shares properly submitted in connection with a shareholder vote to
amend our amended and restated memorandum and articles of association (A) to modify the substance or timing of our obligation to allow
redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial
business combination by December 21, 2022 or (B) with respect to any other material provisions relating to shareholders’ rights
or pre-initial business combination activity; or (iii) absent an initial business combination by December 21, 2022, our return of the
funds held in the trust account to our public shareholders as part of our redemption of the public shares. If we do not invest the proceeds
as discussed above, we may be deemed to be subject to the Investment Company Act. If we were deemed to be subject to the Investment Company
Act, compliance with these additional regulatory burdens would require additional expenses for which we have not allotted funds and may
hinder our ability to complete a business combination. If we are unable to complete our initial business combination, our public shareholders
may only receive their pro rata portion of the funds in the trust account that are available for distribution to public shareholders,
and our warrants will expire worthless.
Nasdaq may delist our securities from trading
on its exchange, which could limit investors’ ability to make transactions in our securities and subject us to additional trading
restrictions.
Although after giving effect to the initial public
offering we expect to meet, on a pro forma basis, the minimum initial listing standards set forth in Nasdaq listing standards, we cannot
assure you that our securities will be, or will continue to be, listed on Nasdaq in the future or prior to our initial business combination.
In order to continue listing our securities on Nasdaq prior to our initial business combination, we must maintain certain financial, distribution
and share price levels. Generally, we must maintain a minimum amount in shareholders’ equity (generally $2,500,000) and a minimum
number of holders of our securities (generally 300 public holders). Additionally, in connection with our initial business combination,
we will be required to demonstrate compliance with Nasdaq’s initial listing requirements, which are more rigorous than Nasdaq’s
continued listing requirements, in order to continue to maintain the listing of our securities on Nasdaq. For instance, our share price
would generally be required to be at least $4.00 per share and our shareholders’ equity would generally be required to be at least
$5.0 million and we would be required to have a minimum of 300 round lot holders of our securities, with at least 50% of such round lot
holders holding securities with a market value of at least $2,500. We cannot assure you that we will be able to meet those initial listing
requirements at that time. If Nasdaq delists our securities from trading on its exchange and we are not able to list our securities on
another national securities exchange, we expect our securities could be quoted on an over-the-counter market. If this were to occur, we
could face significant material adverse consequences, including:
| ● | a
limited availability of market quotations for our securities; |
| ● | reduced
liquidity for our securities; |
| ● | a
determination that our Class A ordinary shares are a “penny stock” which will require brokers trading in our Class A ordinary
shares to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for
our securities; |
| ● | a
limited amount of news and analyst coverage; and |
| ● | a
decreased ability to issue additional securities or obtain additional financing in the future. |
The National Securities Markets Improvement Act
of 1996, which is a federal statute, prevents or preempts the states from regulating the sale of certain securities, which are referred
to as “covered securities.” Our units, Class A ordinary shares and warrants qualify as covered securities under the statute.
Although the states are preempted from regulating the sale of our securities, the federal statute does allow the states to investigate
companies if there is a suspicion of fraud, and, if there is a finding of fraudulent activity, then the states can regulate or bar the
sale of covered securities in a particular case. While we are not aware of a state having used these powers to prohibit or restrict the
sale of securities issued by blank check companies, other than the State of Idaho, certain state securities regulators view blank check
companies unfavorably and might use these powers, or threaten to use these powers, to hinder the sale of securities of blank check companies
in their states. Further, if we were no longer listed on Nasdaq, our securities would not qualify as covered securities under the statute
and we would be subject to regulation in each state in which we offer our securities.
We may issue additional Class A ordinary shares
or preference shares to complete our initial business combination or under an employee incentive plan after completion of our initial
business combination. We may also issue Class A ordinary shares upon the conversion of the founder shares at a ratio greater than one-to-one
at the time of our initial business combination as a result of the anti-dilution provisions contained therein. Any such issuances would
dilute the interest of our shareholders and likely present other risks.
Our amended and restated memorandum and articles
of association authorizes the issuance of up to 500,000,000 Class A ordinary shares, par value $0.0001 per share, 50,000,000 Class B ordinary
shares, par value $0.0001 per share, and 5,000,000 preference shares, par value $0.0001 per share. Immediately after the initial public
offering, there were 442,500,000 and 35,625,000 authorized but unissued Class A ordinary shares and Class B ordinary shares, respectively,
available for issuance which amount does not take into account shares reserved for issuance upon exercise of outstanding warrants, the
forward purchase warrants, shares issuable upon conversion of the Class B ordinary shares, or shares issued upon the sale of the forward
purchase shares. The Class B ordinary shares are automatically convertible into Class A ordinary shares concurrently with or immediately
following the consummation of our initial business combination, initially at a one-for-one ratio but subject to adjustment as set forth
herein and in our amended and restated memorandum and articles of association, including in certain circumstances in which we issue Class
A ordinary shares or equity-linked securities related to our initial business combination. Immediately after the initial public offering,
there were no preference shares issued and outstanding.
We may issue a substantial number of additional
Class A ordinary shares or preference shares to complete our initial business combination or under an employee incentive plan after completion
of our initial business combination. We may also issue Class A ordinary shares upon conversion of the Class B ordinary shares at a ratio
greater than one-to-one at the time of our initial business combination as a result of the anti-dilution provisions as set forth therein.
However, our amended and restated memorandum and articles of association provide, among other things, that prior to our initial business
combination, we may not issue additional shares that would entitle the holders thereof to (i) receive funds from the trust account or
(ii) vote on any initial business combination. These provisions of our amended and restated memorandum and articles of association, like
all provisions of our amended and restated memorandum and articles of association, may be amended with a shareholder vote. The issuance
of additional ordinary or preference shares:
| ● | may
significantly dilute the equity interest of investors in the initial public offering; |
| ● | may
subordinate the rights of holders of Class A ordinary shares if preference shares are issued with rights senior to those afforded our
Class A ordinary shares; |
| ● | could
cause a change in control if a substantial number of Class A ordinary shares are issued, which may affect, among other things, our ability
to use our net operating loss carry forwards, if any, and could result in the resignation or removal of our present officers and directors;
and |
| ● | may
adversely affect prevailing market prices for our units, Class A ordinary shares and/or warrants. |
You will not be permitted to exercise your
warrants unless we register and qualify the underlying Class A ordinary shares or certain exemptions are available.
If the issuance of the Class A ordinary shares
upon exercise of the warrants is not registered, qualified or exempt from registration or qualification under the Securities Act and applicable
state securities laws, holders of warrants will not be entitled to exercise such warrants and such warrants may have no value and expire
worthless. In such event, holders who acquired their warrants as part of a purchase of units will have paid the full unit purchase price
solely for the Class A ordinary shares included in the units.
We are not registering the Class A ordinary shares
issuable upon exercise of the warrants under the Securities Act or any state securities laws at this time. However, under the terms of
the warrant agreement, we have agreed that, as soon as practicable, but in no event later than 15 business days, after the closing of
our initial business combination, we will use our best efforts to file with the SEC a registration statement covering the registration
under the Securities Act of the Class A ordinary shares issuable upon exercise of the warrants and thereafter will use our best efforts
to cause the same to become effective within 60 business days following our initial business combination and to maintain a current prospectus
relating to the Class A ordinary shares issuable upon exercise of the warrants until the expiration of the warrants in accordance with
the provisions of the warrant agreement. We cannot assure you that we will be able to do so if, for example, any facts or events arise
which represent a fundamental change in the information set forth in the registration statement or prospectus, the financial statements
contained or incorporated by reference therein are not current or correct or the SEC issues a stop order.
If the Class A ordinary shares issuable upon exercise
of the warrants are not registered under the Securities Act, under the terms of the warrant agreement, holders of warrants who seek to
exercise their warrants will not be permitted to do so for cash and, instead, will be required to do so on a cashless basis in accordance
with Section 3(a)(9) of the Securities Act or another exemption.
In no event will warrants be exercisable for cash
or on a cashless basis, and we will not be obligated to issue any shares to holders seeking to exercise their warrants, unless the issuance
of the shares upon such exercise is registered or qualified under the securities laws of the state of the exercising holder, or an exemption
from registration or qualification is available.
If our Class A ordinary shares are at the time
of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of “covered securities”
under Section 18(b)(1) of the Securities Act, we may, at our option, not permit holders of warrants who seek to exercise their warrants
to do so for cash and, instead, require them to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act; in
the event we so elect, we will not be required to file or maintain in effect a registration statement or register or qualify the shares
underlying the warrants under applicable state securities laws, and in the event we do not so elect, we will use our best efforts to register
or qualify the shares underlying the warrants under applicable state securities laws to the extent an exemption is not available.
In no event will we be required to net cash settle
any warrant, or issue securities (other than upon a cashless exercise as described above) or other compensation in exchange for the warrants
in the event that we are unable to register or qualify the shares underlying the warrants under the Securities Act or applicable state
securities laws.
You may only be able to exercise your public
warrants on a “cashless basis” under certain circumstances, and if you do so, you will receive fewer Class A ordinary shares
from such exercise than if you were to exercise such warrants for cash.
The warrant agreement provides that in the following
circumstances holders of warrants who seek to exercise their warrants will not be permitted to do for cash and will, instead, be required
to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act: (i) if the Class A ordinary shares issuable upon
exercise of the warrants are not registered under the Securities Act in accordance with the terms of the warrant agreement; (ii) if we
have so elected and the Class A ordinary shares are at the time of any exercise of a warrant not listed on a national securities exchange
such that they satisfy the definition of “covered securities” under Section 18(b)(1) of the Securities Act; and (iii) if we
have so elected and we call the public warrants for redemption.
If you exercise your public warrants on a cashless
basis, you would pay the warrant exercise price by surrendering the warrants for that number of Class A ordinary shares equal to the quotient
obtained by dividing (x) the product of the number of Class A ordinary shares underlying the warrants, multiplied by the excess of the
“fair market value” of our Class A ordinary shares (as defined in the next sentence) over the exercise price of the warrants
by (y) the fair market value. The “fair market value” is the average reported closing price of the Class A ordinary shares
for the 10 trading days ending on the third trading day prior to the date on which the notice of exercise is received by the warrant agent
or on which the notice of redemption is sent to the holders of warrants, as applicable. As a result, you would receive fewer Class A ordinary
shares from such exercise than if you were to exercise such warrants for cash.
The grant of registration rights to our initial
shareholders and holders of our private placement warrants and forward purchase securities may make it more difficult to complete our
initial business combination, and the future exercise of such rights may adversely affect the market price of our Class A ordinary shares.
Our initial shareholders and their permitted transferees
can demand that we register the Class A ordinary shares into which founder shares are convertible, holders of our private placement warrants
and their permitted transferees can demand that we register the private placement warrants and the Class A ordinary shares issuable upon
exercise of the private placement warrants, holders of securities that may be issued upon conversion of working capital loans or holders
of our forward purchase securities and their permitted transferees may demand that we register such units, shares, warrants or the Class
A ordinary shares issuable upon exercise of such warrants and any other securities of the company acquired by them prior to the consummation
of our initial business combination. We will bear the cost of registering these securities. The registration and availability of such
a significant number of securities for trading in the public market may have an adverse effect on the market price of our Class A ordinary
shares. In addition, the existence of the registration rights may make our initial business combination more costly or difficult to conclude.
This is because the shareholders of the target business may increase the equity stake they seek in the combined entity or ask for more
cash consideration to offset the negative impact on the market price of our Class A ordinary shares that is expected when the ordinary
shares owned by our initial shareholders, holders of our private placement warrants, holders of our working capital loans or holders of
our forward purchase securities or their respective permitted transferees are registered.
Unlike some other similarly structured special
purpose acquisition companies, our initial shareholders will receive additional Class A ordinary shares if we issue certain shares to
consummate an initial business combination.
The founder shares will automatically convert
into Class A ordinary shares concurrently with or immediately following the consummation of our initial business combination on a one-for-one
basis, subject to adjustment for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like, and subject
to further adjustment as provided herein. In the case that additional Class A ordinary shares or equity-linked securities are issued or
deemed issued in connection with our initial business combination, the number of Class A ordinary shares issuable upon conversion of all
founder shares will equal, in the aggregate, 20% of the total number of Class A ordinary shares outstanding after such conversion (after
giving effect to any redemptions of Class A ordinary shares by public shareholders), including the total number of Class A ordinary shares
issued, or deemed issued or issuable upon conversion or exercise of any equity-linked securities or rights issued or deemed issued, by
the Company in connection with or in relation to the consummation of the initial business combination (including the forward purchase
shares but not the forward purchase warrants), excluding any Class A ordinary shares or equity-linked securities exercisable for or convertible
into Class A ordinary shares issued, or to be issued, to any seller in the initial business combination and any private placement warrants
issued to our Sponsor, officers or directors upon conversion of working capital loans; provided that such conversion of founder shares
will never occur on a less than one-for-one basis.
Our letter agreement with our Sponsor, officers
and directors may be amended without shareholder approval.
Our letter agreement with our Sponsor, officers
and directors contain provisions relating to transfer restrictions of our founder shares and private placement warrants, indemnification
of the trust account, waiver of redemption rights and participation in liquidating distributions from the trust account. The letter agreement
may be amended without shareholder approval (although releasing the parties from the restriction not to transfer the founder shares for
185 days following the date of the prospectus will require the prior written consent of the underwriters). While we do not expect our
board to approve any amendment to the letter agreement prior to our initial business combination, it may be possible that our board, in
exercising its business judgment and subject to its fiduciary duties, chooses to approve one or more amendments to the letter agreement.
Any such amendments to the letter agreement would not require approval from our shareholders and may have an adverse effect on the value
of an investment in our securities.
Our initial shareholders paid an aggregate
of $25,000, or approximately $0.002 per founder share and, accordingly, you will experience immediate and substantial dilution from the
purchase of our Class A ordinary shares.
The difference between the public offering price
per share (allocating all of the unit purchase price to the Class A ordinary share and none to the warrant included in the unit) and the
pro forma net tangible book value per share of our Class A ordinary shares after the initial public offering constitutes the dilution
to you and the other investors in the initial public offering. Our initial shareholders acquired the founder shares at a nominal price,
significantly contributing to this dilution. Upon closing of the initial public offering, and assuming no value is ascribed to the warrants
included in the units, you and the other public shareholders will incur an immediate and substantial dilution of approximately 96.6% (or
$9.66 per share, assuming no exercise of the underwriters’ over-allotment option), the difference between the pro forma net tangible
book value per share after the initial public offering of $0.34 and the initial offering price of $10.00 per unit. This dilution would
increase to the extent that the anti-dilution provisions of the founder shares result in the issuance of Class A ordinary shares on a
greater than one-to-one basis upon conversion of the founder shares at the time of our initial business combination. In addition, because
of the anti-dilution protection in the founder shares, any equity or equity-linked securities issued in connection with our initial business
combination would be disproportionately dilutive to our Class A ordinary shares.
We may amend the terms of the warrants in a
manner that may be adverse to holders of public warrants with the approval by the holders of at least 50% of the then outstanding public
warrants. As a result, the exercise price of your warrants could be increased, the exercise period could be shortened and the number of
Class A ordinary shares purchasable upon exercise of a warrant could be decreased, all without your approval.
Our warrants will be issued in registered form
under a warrant agreement between Continental Stock Transfer & Trust Company, as warrant agent, and us. The warrant agreement provides
that the terms of the warrants may be amended without the consent of any holder for the purpose of (i) curing any ambiguity or to correct
any defective provision or mistake, including to conform the provisions of the warrant agreement to the description of the terms of the
warrants and the warrant agreement set forth in the prospectus, (ii) adjusting the provisions relating to cash dividends on ordinary shares
as contemplated by and in accordance with the warrant agreement or (iii) adding or changing any provisions with respect to matters or
questions arising under the warrant agreement as the parties to the warrant agreement may deem necessary or desirable and that the parties
deem to not adversely affect the rights of the registered holders of the warrants, provided that the approval by the holders of at least
50% of the then outstanding public warrants is required to make any change that adversely affects the interests of the registered holders
of public warrants. Accordingly, we may amend the terms of the public warrants in a manner adverse to a holder of public warrants if holders
of at least 50% of the then outstanding public warrants approve of such amendment. Although our ability to amend the terms of the public
warrants with the consent of at least 50% of the then outstanding public warrants is unlimited, examples of such amendments could be amendments
to, among other things, increase the exercise price of the warrants, convert the warrants into cash or shares, shorten the exercise period
or decrease the number of Class A ordinary shares purchasable upon exercise of a warrant.
Our warrant agreement designates the courts
of the State of New York or the United States District Court for the Southern District of New York as the sole and exclusive forum for
certain types of actions and proceedings that may be initiated by holders of our warrants, which could limit the ability of warrant holders
to obtain a favorable judicial forum for disputes with our company.
Our warrant agreement provides that, subject to
applicable law, (i) any action, proceeding or claim against us arising out of or relating in any way to the warrant agreement, including
under the Securities Act, will be brought and enforced in the courts of the State of New York or the United States District Court for
the Southern District of New York, and (ii) that we irrevocably submit to such jurisdiction, which jurisdiction shall be the exclusive
forum for any such action, proceeding or claim. We will waive any objection to such exclusive jurisdiction and that such courts represent
an inconvenient forum.
Notwithstanding the foregoing, these provisions
of the warrant agreement will not apply to suits brought to enforce any liability or duty created by the Exchange Act or any other claim
for which the federal district courts of the United States of America are the sole and exclusive forum. Any person or entity purchasing
or otherwise acquiring any interest in any of our warrants shall be deemed to have notice of and to have consented to the forum provisions
in our warrant agreement. If any action, the subject matter of which is within the scope of the forum provisions of the warrant agreement,
is filed in a court other than a court of the State of New York or the United States District Court for the Southern District of New York
(a “foreign action”) in the name of any holder of our warrants, such holder shall be deemed to have consented to: (x) the
personal jurisdiction of the state and federal courts located in the State of New York in connection with any action brought in any such
court to enforce the forum provisions (an “enforcement action”), and (y) having service of process made upon such warrant
holder in any such enforcement action by service upon such warrant holder’s counsel in the foreign action as agent for such warrant
holder.
This choice-of-forum provision may limit a warrant
holder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with our company, which may discourage
such lawsuits. Alternatively, if a court were to find this provision of our warrant agreement inapplicable or unenforceable with respect
to one or more of the specified types of actions or proceedings, we may incur additional costs associated with resolving such matters
in other jurisdictions, which could materially and adversely affect our business, financial condition and results of operations and result
in a diversion of the time and resources of our management and board of directors.
We may redeem your unexpired warrants prior
to their exercise at a time that is disadvantageous to you, thereby making your warrants worthless.
We have the ability to redeem the outstanding
public warrants at any time after they become exercisable and prior to their expiration, at a price of $0.01 per warrant, provided
that the closing price of our Class A ordinary shares equals or exceeds $18.00 per share (as adjusted for adjustments to the number
of shares issuable upon exercise or the exercise price of a warrant) for any 20 trading days within a 30 trading-day period ending on
the third trading day prior to proper notice of such redemption and provided that 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. As a result, we may redeem the warrants as set forth above even if the
holders are otherwise unable to exercise the warrants. Redemption of the outstanding warrants could force you to (i) exercise your
warrants and pay the exercise price therefor at a time when it may be disadvantageous for you to do so, (ii) sell your warrants at
the then-current market price when you might otherwise wish to hold your warrants or (iii) accept the nominal redemption price which,
at the time the outstanding warrants are called for redemption, is likely to substantially less than the market value of your warrants.
None of the private placement warrants or forward purchase warrants will be redeemable by us so long as they are held by the Sponsor or
OrION, as applicable, or their respective permitted transferees.
Our warrants may have an adverse effect on
the market price of our Class A ordinary shares and make it more difficult to effectuate our initial business combination.
We issued warrants to purchase 19,166,667 of our
Class A ordinary shares as part of the units offered and, simultaneously with the closing of the initial public offering, we issued in
a private placement an aggregate of 9,000,000 warrants, at $1.50 per warrant. We may also issue up to 10,000,000 forward purchase warrants
pursuant to the forward purchase agreement. In addition, if the Sponsor makes any working capital loans, it may convert those loans into
up to an additional 1,000,000 private placement warrants, at the price of $1.50 per warrant. To the extent we issue ordinary shares to
effectuate a business transaction, the potential for the issuance of a substantial number of additional Class A ordinary shares upon exercise
of these warrants could make us a less attractive acquisition vehicle to a target business. Such warrants, when exercised, will increase
the number of issued and outstanding Class A ordinary shares and reduce the value of the Class A ordinary shares issued to complete the
business transaction. Therefore, our warrants may make it more difficult to effectuate a business transaction or increase the cost of
acquiring the target business.
Because each unit contains one-third of one
warrant and only a whole warrant may be exercised, the units may be worth less than units of other special purpose acquisition companies.
Each unit contains one-third of one warrant. Pursuant
to the warrant agreement, no fractional warrants will be issued upon separation of the units, and only whole units will trade. If, upon
exercise of the warrants, a holder would be entitled to receive a fractional interest in a share, we will, upon exercise, round down to
the nearest whole number the number of Class A ordinary shares to be issued to the warrant holder. This is different from other offerings
similar to ours whose units include one ordinary share and one warrant to purchase one whole share. We have established the components
of the units in this way in order to reduce the dilutive effect of the warrants upon completion of a business combination since the warrants
will be exercisable in the aggregate for one-third of the number of shares compared to units that each contain a whole warrant to purchase
one share, thus making us, we believe, a more attractive merger partner for target businesses. Nevertheless, this unit structure may cause
our units to be worth less than if it included a warrant to purchase one whole share.
General Risk Factors
We are a blank check company with no operating
history and no revenues, and you have no basis on which to evaluate our ability to achieve our business objective.
We are a blank check company incorporated under
the laws of the Cayman Islands with no operating results, and we will not commence operations until obtaining funding through the initial
public offering. Because we lack an operating history, you have no basis upon which to evaluate our ability to achieve our business objective
of completing our initial business combination. We have no plans, arrangements or understandings with any prospective target business
concerning a business combination and may be unable to complete our initial business combination. If we fail to complete our initial business
combination, we will never generate any operating revenues.
Past performance by our management team and
their affiliates, including investments and transactions in which they have participated and businesses with which they have been associated,
may not be indicative of future performance of an investment in the Company.
Information regarding our management team and
their affiliates, including investments and transactions in which they have participated and businesses with which they have been associated,
is presented for informational purposes only. Any past experience and performance by our management team and their affiliates and the
businesses with which they have been associated, is not a guarantee that we will be able to successfully identify a suitable candidate
for our initial business combination, that we will be able to provide positive returns to our shareholders, or of any results with respect
to any initial business combination we may consummate. You should not rely on the historical experiences of our management team and their
affiliates, including investments and transactions in which they have participated and businesses with which they have been associated,
as indicative of the future performance of an investment in us or as indicative of every prior investment by each of the members of our
management team or their affiliates. The market price of our securities may be influenced by numerous factors, many of which are beyond
our control, and our shareholders may experience losses on their investment in our securities.
Cyber incidents or attacks directed at us could
result in information theft, data corruption, operational disruption and/or financial loss.
We depend on digital technologies, including information
systems, infrastructure and cloud applications and services, including those of third parties with which we may deal. Sophisticated and
deliberate attacks on, or security breaches in, our systems or infrastructure, or the systems or infrastructure of third parties or the
cloud, could lead to corruption or misappropriation of our assets, proprietary information and sensitive or confidential data. As an early
stage company without significant investments in data security protection, we may not be sufficiently protected against such occurrences.
We may not have sufficient resources to adequately protect against, or to investigate and remediate any vulnerability to, cyber incidents.
It is possible that any of these occurrences, or a combination of them, could have adverse consequences on our business and lead to financial
loss.
Changes in laws or regulations, or a failure
to comply with any laws and regulations, may adversely affect our business, including our ability to negotiate and complete our initial
business combination, and results of operations.
We are subject to laws and regulations enacted
by national, regional and local governments. In particular, we will be required to comply with certain SEC and other legal requirements,
including with the law of the jurisdiction of our incorporation. Compliance with, and monitoring of, applicable laws and regulations may
be difficult, time consuming and costly. Those laws and regulations and their interpretation and application may also change from time
to time and those changes could have a material adverse effect on our business, investments and results of operations. In addition, a
failure to comply with applicable laws or regulations, as interpreted and applied, could have a material adverse effect on our business,
including our ability to negotiate and complete our initial business combination, and results of operations.
We are an emerging growth company and a smaller
reporting company within the meaning of the Securities Act, and if we take advantage of certain exemptions from disclosure requirements
available to emerging growth companies or smaller reporting companies, this could make our securities less attractive to investors and
may make it more difficult to compare our performance with other public companies.
We are an “emerging growth company”
within the meaning of the Securities Act, as modified by the JOBS Act, and we may take advantage of certain exemptions from various reporting
requirements that are applicable to other public companies that are not emerging growth companies, including, but not limited to, not
being required to comply with the auditor internal controls attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced
disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements
of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously
approved. As a result, our shareholders may not have access to certain information they may deem important. We could be an emerging growth
company for up to five years, although circumstances could cause us to lose that status earlier, including if the market value of our
Class A ordinary shares held by non-affiliates exceeds $700 million as of any June 30 before that time, in which case we would no longer
be an emerging growth company as of the following December 31. We cannot predict whether investors will find our securities less attractive
because we will rely on these exemptions. If some investors find our securities less attractive as a result of our reliance on these exemptions,
the trading prices of our securities may be lower than they otherwise would be, there may be a less active trading market for our securities
and the trading prices of our securities may be more volatile.
Further, Section 102(b)(1) of the JOBS Act exempts
emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that
is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered
under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company
can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but
any such an election to opt out is irrevocable. We have elected not to opt out of such extended transition period which means that when
a standard is issued or revised and it has different application dates for public or private companies, we, as an emerging growth company,
can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of our
financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has
opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards
used.
Additionally, we are a “smaller reporting
company” as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure
obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting
company until the last day of the fiscal year in which (1) the market value of our ordinary shares held by non-affiliates exceeds $250
million as of the prior June 30, or (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value
of our ordinary shares held by non-affiliates exceeds $700 million as of the 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.
Our warrants are accounted for as liabilities
and the changes in value of our warrants could have a material effect on our financial results.
On April 12, 2021, the Acting Director of the
Division of Corporation Finance and Acting Chief Accountant of the SEC together issued the SEC Staff Statement. Specifically, the SEC
Staff Statement focused on certain settlement terms and provisions related to certain tender offers following a business combination,
which terms are similar to those contained in the warrant agreement governing our warrants. As a result of the SEC Staff Statement, we
reevaluated the accounting treatment of our 19,166,667 public warrants and 9,000,000 private placement warrants, and determined to classify
the warrants as derivative liabilities measured at fair value, with changes in fair value each period reported in earnings.
As a result, included on our balance sheet as
of December 31, 2021 contained elsewhere in this Annual Report are derivative liabilities related to our warrants. Accounting Standards
Codification 815, Derivatives and Hedging (“ASC 815”), provides for the remeasurement of the fair value of such derivatives
at each balance sheet date, with a resulting non-cash gain or loss related to the change in the fair value being recognized in earnings
in the statement of operations. As a result of the recurring fair value measurement, our financial statements and results of operations
may fluctuate quarterly, based on factors, which are outside of our control. Due to the recurring fair value measurement, we expect that
we will recognize non-cash gains or losses on our warrants each reporting period and that the amount of such gains or losses could be
material. The impact of changes in fair value on earnings may have an adverse effect on the market price of our ordinary shares. In addition,
potential targets may seek a special purpose acquisition company that does not have warrants that are accounted for as liability, which
may make it more difficult for us to consummate an initial business combination with a target business.
We have identified material weaknesses in our
internal control over financial reporting. These material weaknesses could continue to adversely affect our ability to report our results
of operations and financial condition accurately and in a timely manner.
Our management is responsible for establishing
and maintaining adequate internal control over financial reporting designed to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP. Our management is likewise
required, on a quarterly basis, to evaluate the effectiveness of our internal controls and to disclose any changes and material weaknesses
identified through such evaluation in those internal controls. A material weakness is a deficiency, or a combination of deficiencies,
in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or
interim financial statements will not be prevented or detected on a timely basis.
As described elsewhere in this Annual Report,
we identified material weaknesses in our internal control over financial reporting related to our accounting for complex instruments and
relating to the process of recording accounts payable and accrued expenses.
As a result of these material weaknesses, our
management concluded that our internal control over financial reporting was not effective as of December 31, 2021.
Our independent registered public accounting
firm’s report contains an explanatory paragraph that expresses substantial doubt about our ability to continue as a “going
concern.”
We may not have sufficient liquidity to meet anticipated
obligations over the next year from the issuance of these financial statements. In connection with our assessment of “going concern”
considerations in accordance with ASC Topic 205-40 Presentation of Financial Statements – Going Concern, we have until December
21, 2022 to consummate a business combination. It is uncertain that we will be able to consummate a business combination by this time.
If a business combination is not consummated by this date, there will be a mandatory liquidation and subsequent dissolution of the company.
Management has determined that the liquidity condition and mandatory liquidation, should a business combination not occur, and potential
subsequent dissolution raises substantial doubt about our ability to continue as a going concern. No adjustments have been made to the
carrying amounts of assets or liabilities should the company be required to liquidate after December 21, 2022.