ITEM 2. |
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
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References to the “Company,” “Figure Acquisition Corp. I.,” “our,” “us” or “we” refer to Figure Acquisition Corp. I. The following discussion and analysis of our financial
condition and results of operations should be read in conjunction with the unaudited condensed financial statements and the notes thereto contained elsewhere in this report. Certain information contained
in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.
Cautionary Note Regarding Forward-Looking Statements
This Quarterly Report includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act. We have based these
forward-looking statements on our current expectations and projections about future events. These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions about us that may cause our actual results, levels
of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. In some cases, you can identify forward-looking
statements by terminology such as “may,” “should,” “could,” “would,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “continue,” or the negative of such terms or other similar expressions. Factors that might cause or contribute to such a
discrepancy include, but are not limited to, those described in our other SEC filings.
Overview
We are a blank check company incorporated in Delaware on December 15, 2020. We were formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar
business combination with one or more businesses (the “Business Combination”).
Our Sponsor is Fintech Acquisition LLC, a Delaware limited liability company. The registration statement for the Initial Public Offering was declared effective on February 18, 2021. On February 23, 2021, we
consummated the Initial Public Offering of 28,750,000 Units, at $10.00 per Unit, generating gross proceeds of $287.5 million, and incurring offering costs of approximately $16.3 million, inclusive of approximately $10.1 million in deferred
underwriting commissions.
Simultaneously with the closing of the Initial Public Offering, we consummated the Private Placement of 5,166,667 Private Placement Warrants, at a price of $1.50 per Private Placement Warrant to our Sponsor,
generating gross proceeds to us of approximately $7.75 million.
Upon the closing of the Initial Public Offering and the Private Placement, $287.5 million ($10.00 per Unit) of the net proceeds of the Initial Public Offering and certain of the proceeds of the Private Placement
was placed in the Trust Account and was invested in permitted United States “government securities” within the meaning of Section 2(a)(16) of the Investment Company Act of 1940, as amended, having a maturity of 185 days or less or in money market
funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act that invest only in direct U.S. government treasury obligations.
Our management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering and the sale of the Private Placement Warrants, although substantially all of the net
proceeds are intended to be applied generally toward consummating a Business Combination.
We will only have 24 months from the closing of the Initial Public Offering, or February 23, 2023, subject to the approval and implementation of the Proxy Proposal, to complete our initial Business Combination (the
“Combination Period”). If we do not complete a Business Combination within this period of time, we will (i) cease all operations except for the purposes of winding up; (ii) as promptly as reasonably possible, but not more than ten business days
thereafter, redeem the Public Shares for a per share pro rata portion of the Trust Account, including interest and not previously released to us to fund our working capital requirements (subject to an annual limit of $500,000) (less taxes payable
and up to $100,000 of such net interest to pay dissolution expenses) and (iii) as promptly as possible following such redemption, dissolve and liquidate the balance of our net assets to our remaining stockholders, as part of our plan of
dissolution and liquidation. Our Sponsor and our executive officers and independent director nominees (the “initial stockholders”) entered into a letter agreement with us, pursuant to which they have waived their rights to participate in any
redemption with respect to their Founder Shares; however, if the initial stockholders or any of our officers, directors or affiliates acquire shares of common stock in or after the Initial Public Offering, they will be entitled to a pro rata
share of the Trust Account upon our redemption or liquidation in the event we do not complete a Business Combination within the required time period. In the event of such distribution, it is possible that the per share value of the residual
assets remaining available for distribution (including Trust Account assets) will be less than the Initial Public Offering price per Unit in the Initial Public Offering.
Recent Developments
On November 3, 2022, we filed with the SEC preliminary proxy materials with respect to a proposed special meeting of stockholders seeking approval of, among other matters, a proposal to (x) extend the date by which
we must consummate an initial Business Combination from February 23, 2023 to a to-be-determined date in 2023 or such earlier date as determined by the Company’s board of directors (the “Proposed Extension”); and/or (y) change the date on which
Continental Stock Transfer & Trust Company must commence liquidation of the Trust Account, established in connection with the Company’s IPO, to an amended termination date (the “Proposed Amendment to the Termination Date” and, together with
the Proposed Extension, the “Proxy Proposal”). Our board of directors may determine at any time not to proceed with the Proposed Extension. There can be no assurance that definitive proxy materials will be filed and distributed to our
stockholders as of the record date for such proposed meeting or, if the Proposed Extension and other related proposals are approved by our stockholders, that our board of directors will ultimately determine to implement the Proposed Extension. If
the Proposed Extension is approved and implemented, our public stockholders will be entitled to redeem their properly tendered public shares for a pro rata portion of the amount in the trust account established for the benefit of our public
stockholders (the “Trust Account”), in accordance with our charter.
Results of Operations
For the three months ended September 30, 2022, we had a net income of approximately $2.1 million, which included a gain from the change in fair value of warrant liabilities of $1.5 million and interest earned on
marketable securities held in trust account of $1.3 million, partially offset by a loss from operations of $0.4 million and provision for income taxes of $0.3 million.
For the nine months ended September 30, 2022, we had a net income of approximately $14.1 million, which included a gain from the change in fair value of warrant liabilities of $13.7 million and interest earned on
marketable securities held in trust account of $1.8 million, offset mainly by a loss from operations of $1.1 million and provision for income tax of $0.3 million.
For the three months ended September 30, 2021, we had a net income of approximately $3.9 million, which included interest earned on marketable securities held in trust account of $20,526 and gain from the change in
fair value of warrant liabilities of $4.2 million, partially offset by a loss from operations of $0.2 million and fair value of private warrants in excess of proceeds received of $0.2 million.
For the nine months ended September 30, 2021, we had a net income of approximately $4.7 million, which included interest earned on marketable securities held in trust account of $24,018 and gain from the change in
fair value of warrant liabilities of $5.9 million, offset by a loss from operations of $0.45 million, offering costs allocated to warrants of $0.6 million and fair value of private warrants in excess of proceeds received of $0.2 million.
Our business activities from inception to September 30, 2022 consisted primarily of our formation and completing our IPO, and since the offering, our activity has been limited to identifying and evaluating
prospective acquisition targets for a Business Combination.
Liquidity, Capital Resources, and Going Concern
As of September 30, 2022, we had approximately $0.3 million in our operating bank account and working capital deficit of approximately $4,000, net of franchise and income taxes payable and taxes paid out of
operating funds not yet reimbursed by the Trust, as applicable, of approximately $0.3 million.
For the nine months ended September 30, 2022, net cash used in operating activities was approximately $0.8 million. Net income of $14.1 million was attributable to the change in fair value of warrant liabilities of
$13.7 million, interest earned on marketable securities held in the Trust Account of $1.8 million and changes in operating assets and liabilities which provided $0.7 million in cash from operating activities.
For the nine months ended September 30, 2021, net cash used in operating activities was approximately $0.7 million. Net income of $4.7 million was attributable to the change in fair value of warrant liability of
$5.9 million, interest earned on marketable securities held in the Trust Account of $24,018, offset by offering costs allocated to warrants of $0.6 million, the fair value of private warrants in excess of proceeds received of $0.2 million, and
changes in operating assets and liabilities, which used $0.2 million in cash from operating activities.
As of September 30, 2022, we had cash and marketable securities held in the Trust Account of approximately $288.7 million. We may withdraw interest to pay franchise and income taxes. Through September 30, 2022,
cash withdrawn from the Trust Account to pay franchise and income taxes totaled $317,039 which was withdrawn during the nine months ended September 30, 2022. To the extent that our capital stock or debt is used, in whole or in part, as
consideration to complete our Business Combination, the remaining proceeds held in the Trust Account will be used as working capital to finance the operations of the target business or businesses, make other acquisitions and pursue our growth
strategies.
As of September 30, 2022, we had cash of approximately $0.3 million held outside of our Trust Account.
Our liquidity needs up to February 23, 2021 had been satisfied through a capital contribution from the Sponsor of $25,000 (see Note 5) for the Founder shares and Class L shares, and the loan under an unsecured
promissory note from the Sponsor of up to $300,000 which was paid in full on February 23, 2021 from the IPO proceeds (see Note 5).
Subsequent to the consummation of the IPO, our liquidity needs have been satisfied through the net proceeds from the consummation of the Private Placement not held in the Trust Account. In order to finance
transaction costs in connection with a Business Combination, our Sponsor or certain of our officers and directors may, but are not obligated to, provide us working capital loans. Additionally, an affiliate of our Sponsor entered into a commitment
letter with us whereby the affiliate of our Sponsor agreed to provide working capital loans sufficient for us to satisfy our obligations as they come due until the earlier of: (a) the completion of the initial Business Combination, or (b)
liquidation. Any such working capital loan under the commitment letter will be repaid to the affiliate of our Sponsor by us upon the completion of the initial Business Combination or, in the event of liquidation prior to the completion of the
initial Business Combination, forgiven by the affiliate of our Sponsor upon liquidation. The Sponsor advanced an aggregate of $535,885 which was repaid in full during the nine-months ended September 30, 2022. As of September 30, 2022 and December
31, 2021, there were no amounts outstanding under any working capital loan and we did not have any off-balance sheet arrangements.
If we do not consummate an initial business combination by February 23, 2023, subject to the approval and implementation of the Proxy Proposal, there will be a mandatory liquidation and subsequent dissolution of
the Company. Management has determined that the mandatory liquidation, should an initial business combination not occur, and potential subsequent dissolution raises substantial doubt about our ability to continue as a going concern. The Company
intends to consummate an initial business combination prior to February 23, 2023, subject to the approval and implementation of the Proxy Proposal; however, it is uncertain whether the Company will be able to do so by this time or that the Proxy
Proposal will be approved and implemented. The unaudited condensed financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Management continues to evaluate the impact of the COVID-19 pandemic and has concluded that the specific impact is not readily determinable as of the date of the balance sheet. The unaudited condensed financial
statements do not include any adjustments that might result from the outcome of this uncertainty.
In February 2022, the Russian Federation and Belarus commenced a military action with the country of Ukraine. As a result of this action, various nations, including the United States, have instituted economic
sanctions against the Russian Federation and Belarus. Further, the impact of this action and related sanctions on the world economy are not determinable as of the date of these unaudited condensed financial statements and the specific impact on
our financial condition, results of operations, and cash flows is also not determinable as of the date of these unaudited condensed financial statements.
Contractual Obligations
We do not have any long-term debt obligations, capital lease obligations, operating lease obligations, purchase obligations or long-term liabilities.
Registration Rights
The initial stockholders and holders of the Private Placement Warrants will be entitled to registration rights pursuant to a registration rights agreement. The initial stockholders and holders of the Private
Placement Warrants will be entitled to make up to three demands, excluding short form registration demands, that register such securities for sale under the Securities Act. In addition, these holders will have “piggy-back” registration rights to
include their securities in other registration statements filed by us. We will bear the expenses incurred in connection with the filing of any such registration statements.
Underwriting Agreement
We agreed to pay the underwriters an additional fee (the “Deferred Underwriting Fees”) of 3.5% of the gross proceeds of the IPO, or $10,062,500 in the aggregate. The Deferred Underwriting Fees will become payable
to the underwriters from the amounts held in the Trust Account solely in the event that we complete a Business Combination, subject to the terms of the underwriting agreement.
Critical Accounting Policies
This management’s discussion and analysis of our financial condition and results of operations is based on our unaudited condensed financial statements, which have been prepared in accordance with U.S. GAAP. The
preparation of these unaudited condensed financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, income and expenses and the disclosure of contingent assets and liabilities in our
unaudited condensed financial statements. On an ongoing basis, we evaluate our estimates and judgments, including those related to fair value of financial instruments and accrued expenses. We base our estimates on historical experience, known
trends and events and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from
other sources. Actual results may differ from these estimates under different assumptions or conditions.
There have been no changes in our critical accounting policies as discussed in our Annual Report on Form 10-K for the year ended December 31, 2021 as filed with the Securities and Exchange Commission (the “SEC”) on
April 13, 2022 (the “Annual Report”).
Recent Accounting Pronouncements
In August 2020, the FASB issued ASU 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible
Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”), which simplifies accounting for convertible instruments by removing major separation models required under current GAAP. ASU 2020-06 also removes certain settlement conditions
that are required for equity-linked contracts to qualify for scope exception, and it simplifies the diluted earnings per share calculation in certain areas. We early adopted ASU 2020-06 on January 1, 2021. Adoption of the ASU did not impact our
financial position, results of operations or cash flows.
We do not believe that any other recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on our unaudited condensed financial statements.
Inflation
We do not believe that inflation had a material impact on our business or operating results during the period presented.
JOBS Act
The Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”) contains provisions that, among other things, relax certain reporting requirements for qualifying public companies. We qualify as an “emerging growth
company” and under the JOBS Act are allowed to comply with new or revised accounting pronouncements based on the effective date for private (not publicly traded) companies. We are electing to delay the adoption of new or revised accounting
standards, and as a result, we may not comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. As a result, the unaudited condensed financial
statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates.
Additionally, we intend to rely on the other reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, we will not be required to, among other things, (i)
provide an auditor’s attestation report on our system of internal controls over financial reporting pursuant to Section 404, (ii) provide all of the compensation disclosure that may be required of non-emerging growth public companies under the
Dodd-Frank Wall Street Reform and Consumer Protection Act, (iii) comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report
providing additional information about the audit and the financial statements (auditor discussion and analysis) and (iv) disclose certain executive compensation related items such as the correlation between executive compensation and performance
and comparisons of the CEO’s compensation to median employee compensation. These exemptions will apply for a period of five years following the completion of our Initial Public Offering or until we are no longer an “emerging growth company,”
whichever is earlier.
PART II.
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OTHER INFORMATION
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Item 1. |
Legal Proceedings.
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None.
Except as set forth below, as of the date of this Quarterly Report, there have been no material changes to the risk factors previously disclosed in “Part I, Item 1A., Risk Factors” of our Annual Report on Form 10-K
for the year ended December 31, 2021, our subsequently filed Quarterly Reports on Form 10-Q, and any other documents filed by the Company with the SEC. Any of these factors could result in a significant or material adverse effect on our results
of operations or financial condition. Additional risk factors not presently known to us or that we currently deem immaterial may also impair our business or results of operations. We may also disclose changes to such risk factors or disclose
additional risk factors from time to time in our future filings with the SEC.
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 in elsewhere in this Quarterly Report, during the second quarter of 2022, we identified an additional material weakness related to the incorrect accounting for certain accrued liabilities.
As described in our Annual Report, we previously identified a material weakness in our internal control over financial reporting in connection with our incorrect accounting for warrants and complex equity and
equity linked instruments. The Company incorrectly accounted for the Class A common stock subject to possible redemption at the closing of our initial public offering and had also previously classified a portion of the Class A common stock in
permanent equity. As a result of this material weakness, our management concluded that our internal control over financial reporting was not effective as of December 31, 2021 and also not effective as of the end of each of the interim periods
during the year ended December 31, 2021. This material weakness resulted in a material misstatement of the initial carrying value of the Class A common stock subject to possible redemption and earnings per share calculations for the affected
periods.
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, and remained ineffective as of September 30, 2022.
To respond to these material weaknesses, we have devoted, and plan to continue to devote, significant effort and resources to the remediation and improvement of our internal control over financial reporting. While
we have processes to identify and appropriately apply applicable accounting requirements, we plan to enhance these processes to better evaluate our research and understanding of the nuances of the complex accounting standards that apply to our
financial statements. Our plans at this time include providing enhanced access to accounting literature, research materials and documents and increased communication among our personnel and third-party professionals with whom we consult regarding
complex accounting applications, as well as enhancing our review process related to the accrued liabilities included in our financial statements. The elements of our remediation plan can only be accomplished over time, and we can offer no
assurance that these initiatives will ultimately have the intended effects. For a discussion of management’s consideration of the material weaknesses identified relating to our incorrect accounting for warrants and complex equity and equity
linked instruments and relating to our incorrect accounting for liability accruals, see “Part II, Item 4. Controls and Procedures”
Any failure to maintain such internal control could adversely impact our ability to report our financial position and results from operations on a timely and accurate basis. If our financial statements are not
accurate, investors may not have a complete understanding of our operations and we could be subject to litigation, investigations or other proceedings by investors, the SEC or other regulatory authorities. Likewise, if our financial statements
are not filed on a timely basis, we could be subject to sanctions or investigations by the stock exchange on which our common stock is listed, the SEC or other regulatory authorities. In either case, there could result a material adverse effect
on our business. Ineffective internal controls could also cause investors to lose confidence in our reported financial information, which could have a negative effect on the trading price of our shares.
We can give no assurance that the measures we have taken and plan to take in the future will remediate the material weaknesses identified or that any additional material weaknesses or restatements of financial
results will not arise in the future due to a failure to implement and maintain adequate internal control over financial reporting or circumvention of these controls. In addition, even if we are successful in strengthening our controls and
procedures, in the future those controls, and procedures may not be adequate to prevent or identify irregularities or errors or to facilitate the fair presentation of our financial statements.
A new 1% U.S. federal excise tax could be imposed on us in connection with redemptions by us of our shares.
On August 16, 2022, President Biden signed into law the Inflation Reduction Act of 2022 (H.R. 5376) (the “IRA”), which, among other things, imposes a 1% excise tax on any domestic corporation that repurchases its
stock after December 31, 2022 (the “Excise Tax”). The Excise Tax is imposed on the repurchasing corporation itself, not its stockholders from which the stock is repurchased. Because we are a Delaware corporation and our securities are trading on
the NYSE, we are a “covered corporation” for this purpose. The amount of the Excise Tax is generally 1% of the fair market value of the shares repurchased at the time of the repurchase. However, for purposes of calculating the Excise Tax,
repurchasing corporations are permitted to net the fair market value of certain new stock issuances against the fair market value of stock repurchases during the same taxable year. In addition, certain exceptions apply to the excise tax. The U.S.
Department of Treasury has been given authority to provide regulations and other guidance to carry out, and prevent the abuse or avoidance of the Excise Tax; however, no guidance has been issued to date. It is uncertain whether, and/or to what
extent, the Excise Tax could apply to any redemptions of our public shares after December 31, 2022, including any redemptions in connection with an initial business combination or in the event we do not consummate an initial business combination
by the end of the Combination Period.
If the Combination Period (currently terminating as of February 23, 2023) is extended (the “Extension”), our public stockholders will have the right to require us to redeem their public shares. Moreover, any
redemption or other repurchase that we make that occurs after December 31, 2022 may be subject to the Excise Tax. Whether and to what extent we would be subject to the Excise Tax would depend on a number of factors, including (i) the fair market
value of the redemptions and repurchases in connection with our initial business combination; (ii) the structure of the business combination; (iii) the nature and amount of any “PIPE” or other equity issuances in connection with the business
combination (or otherwise issued not in connection with the business combination but issued within the same taxable year of the business combination); and (iv) the content of regulations and other guidance from the U.S. Department of the
Treasury. In addition, because the excise tax would be payable by us, and not by the redeeming holder, the mechanics of any required payment of the excise tax have not been determined. The foregoing could cause a reduction in the cash available
on hand to complete a business combination and limit our ability to complete a business combination.
If we are deemed to be an investment company for purposes of the Investment Company Act, we may be forced to abandon our efforts to complete an initial business combination
and instead be required to liquidate the Company. To mitigate the risk of that result, on or prior to the 24-month anniversary of the effective date of the registration statement relating to our IPO, we will instruct Continental Stock Transfer
& Trust Company to liquidate the securities held in the trust account and instead hold all funds in the trust account in cash. As a result, following such change, we will likely receive minimal, if any, interest, on the funds held in the
trust account, which would reduce the dollar amount that our public stockholders would have otherwise received upon any redemption or liquidation of the Company if the assets in the trust account had remained in U.S. government securities or
money market funds.
On March 30, 2022, the SEC issued the SPAC Rule Proposals, relating, among other things, to circumstances in which SPACs such as us could potentially be subject to the Investment Company Act and the regulations
thereunder. The SPAC Rule Proposals would provide a safe harbor for such companies from the definition of “investment company” under Section 3(a)(1)(A) of the Investment Company Act, provided that a SPAC satisfies certain criteria. To comply with
the duration limitation of the proposed safe harbor, a SPAC would have a limited time period to announce and complete a de-SPAC transaction. Specifically, to comply with the safe harbor, the SPAC Rule Proposals would require a company to file a
report on Form 8-K announcing that it has entered into an agreement with a target company for an initial business combination no later than 18 months after the effective date of the registration statement for its initial public offering. The
company would then be required to complete its initial business combination no later than 24 months after the effective date of the registration statement for its initial public offering. We understand that the SEC has recently been taking
informal positions regarding the Investment Company Act consistent with the SPAC Rule Proposals.
There is currently uncertainty concerning the applicability of the Investment Company Act to a SPAC, including a company like ours, that does not complete its initial business combination within the proposed time
frame set forth in the proposed safe harbor rule. As indicated above, we completed our IPO in February 2021 and have operated as a blank check company searching for a target business with which to consummate an initial business combination since
such time. As a result, it is possible that a claim could be made that we have been operating as an unregistered investment company if the SPAC Rule Proposals are adopted as proposed. If we were deemed to be an investment company for purposes of
the Investment Company Act, we might be forced to abandon our efforts to complete an initial business combination and instead be required to liquidate the Company. If we are required to liquidate the Company, our investors would not be able to
realize the benefits of owning shares in a successor operating business, including the potential appreciation in the value of our shares and warrants or rights following such a transaction, and our warrants or rights would expire worthless.
The funds in the trust account have, since our IPO, been held only in U.S. government treasury obligations with a maturity of 185 days or less or in money market funds investing solely in U.S. government treasury
obligations and meeting certain conditions under Rule 2a-7 under the Investment Company Act. To mitigate the risk of us being deemed to have been operating as an unregistered investment company under the Investment Company Act, we will, on or
prior to the 24-month anniversary of the effective date of the registration statement relating to our IPO, or February 23, 2023, instruct Continental Stock Transfer & Trust Company, the trustee with respect to the trust account, to liquidate
the U.S. government treasury obligations or money market funds held in the trust account and thereafter to hold all funds in the trust account in cash (i.e., in one or more bank accounts) until the earlier of the consummation of a business
combination or our liquidation. Following such liquidation of the assets in our trust account, we will likely receive minimal interest, if any, on the funds held in the trust account, which would reduce the dollar amount our public stockholders
would have otherwise received upon any redemption or liquidation of the Company if the assets in the trust account had remained in U.S. government securities or money market funds. This means that the amount available for redemption will not
increase in the future, and those stockholders who elect not to redeem their public shares in connection with the Charter Amendment will receive no more than the same per share amount, without additional interest, if they redeem their public
shares in connection with a business combination or if the Company is liquidated in the future, in each case as compared with the per share amount they would have received if they had redeemed their public shares in connection with the Charter
Amendment.
In addition, even prior to the 24-month anniversary of the effective date of the registration statement relating to our IPO, we may be deemed to be an investment company. The longer that the funds in the trust
account are held in short-term U.S. government securities or in money market funds invested exclusively in such securities, even prior to the 24-month anniversary, there is a greater risk that we may be considered an unregistered investment
company, in which case we may be required to liquidate. Accordingly, we may determine, in our discretion, to liquidate the securities held in the trust account at any time, even prior to the 24-month anniversary, and instead hold all funds in the
trust account in cash, which would further reduce the dollar amount our public stockholders would receive upon any redemption or our liquidation.
Item 2. |
Unregistered Sales of Equity Securities and Use of Proceeds.
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None.
Item 3. |
Defaults Upon Senior Securities.
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None.
Item 4. |
Mine Safety Disclosures.
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Not applicable.
Item 5. |
Other Information.
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None.
Exhibit
Number
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Description
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Certification of Chief Executive Officer (Principal Executive Officer) Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
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Certification of Chief Financial Officer (Principal Financial and Accounting Officer) Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302
of the Sarbanes-Oxley Act of 2002.
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Certification of Chief Executive Officer (Principal Executive Officer) Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
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Certification of Chief Financial Officer (Principal Financial and Accounting Officer) Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
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101.INS
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XBRL Instance Document
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101.SCH
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XBRL Taxonomy Extension Schema Document
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101.CAL
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XBRL Taxonomy Extension Calculation Linkbase Document
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101.DEF
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XBRL Taxonomy Extension Definition Linkbase Document
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101.LAB
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XBRL Taxonomy Extension Label Linkbase Document
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101.PRE
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XBRL Taxonomy Extension Presentation Linkbase Document
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These certifications are furnished to the SEC pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and are deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall they be deemed
incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.
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